ESG
Databook
2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

ESG Databook 2021
Management of Environmental and Social Initiatives
Materiality(Formulating CSR Themes)003

Our system to promote Sustainability008

Our concept of environmental activities andpromotion system

009

Setting Mid- and Long-Term Targets and Progress012

Organizational Chart of
the Environmental Management Structure014

Acquiring ISO14001

015

Dialogue with Our Stakeholders

016

Major Achievements

018

Comparison with Global Principles

024

External Evaluations

026

Green Bond031

Our Suppot for Midori-kai member companies（Environment）

139

Safety and environmental initiativesat sales and service
companies

144

Environmental Risk Management

146

Biodiversity

155

Communication with Stakeholders

160

Data

Theme 1 : Enhancing Quality of Life

Major Environmental Achievements in the previous year.

164

Environmental Education

168

Environmental Accounting

171

Site Data

175

Scope of Environmental Data/Calculation Standards

180

Amount of CO2 Emissions by Scope3

184

Independent Practitioner's Assurance

185

Other CSR Data

186

Improving Product Safety and Solutions

034

Social Contribution Activities

Quality and Reliability- Responsible Commitment to Customers -039

Accomplishments and Approaches for Social Contribution
Activities

Relationship between Business Activities
and the Environment

188

046

Komatsu's Initiatives for the Social Issues

191

Climate Change048

Developing People Needed by the Community

193

Our Challenge to establish Recycling-based Society

057

Collaboration with Cummins Inc.

194

Disaster Relief

196

Clearing Anti-Personnel Landmines andCommunity Development Support

199

Theme 2 : Developing People
Personnel Policy and Performance Appraisal System

064

Diversity Initiatives

070

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

Work-Life Balance and Diverse Workstyles

076

203

Employee Training Structure

080

Promoting Sports̶The Komatsu Women's Judo Club204

Enhancing the KOMATSU Way

082

An employee-participatory social contribution program"One World One Komatsu"

205

Strengthening Our "Gemba" Capability

085

Index

Brand Management Initiatives

087

GRI STANDARDS INDEX

208
220

SASB Content Index

Theme 3 : Growing with Society
Corporate Governance Indicators

091

Compliance094

Human Rights Policy

098

Business and Human Rights

100

Risk Management

103

Information Security

108

Occupational Safety and Health110

Outline of Procurement Policy and Supply Chain

119

CSR Procurement Guidelines

123

Support for Member Companies of the Komatsu Midori-kai(Management and Society)131

Editorial Policy
This publication is the compiled PDF version of Komatsu's webpage "ESG
Databook", as of July 20, 2021.
The reports principally cover all our domestic and overseas consolidated Group
companies and if the scope is diﬀerent from the above, we stated the scope ofreport in each page.
The date of the previous report is July 2020. We publish these reports every July,and the next issue will be published in July 2022.
Please use this form to send us any questions regarding our reports.
The reports contain Standard Disclosures from the GRI Sustainability ReportingStandards. You can see a list of the Standard Disclosures and their location in ourreport here.
Komatsu has received an independent practitioner's assurance on important
quantitative data in environmental reporting, which can be viewed here.

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Management of Environmental and Social Initiatives

Materiality(Formulating CSR Themes)003

Our system to promote Sustainability008

Our concept of environmental activities and promotion system

009

Setting Mid- and Long-Term Targets and Progress012

Organizational Chart of the Environmental Management Structure014

Acquiring ISO14001

015

Dialogue with Our Stakeholders

016

Major Achievements

018

Comparison with Global Principles

024

External Evaluations

026

Green Bond031

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Materiality(Formulating CSR Themes)
Komatsu formulated its CSR themes in 2010, placing CSR activities as the ones to respond to social needs through core business, uponmuch discussion on defining initiatives that would both be of value to society and to Komatsu.
Also, in the Mid-Term Management Plan announced in April 2019, we touch upon the growth strategy in our core business in relation
with our CSR themes, and are striving for sustainable growth through a positive cycle of improving earnings and solving ESG issues.
In addition, even in social contribution activities that do not aim at direct profitability, we strive to contribute to society in a way thatdraws on the strengths of our core business through initiatives aligned with our CSR themes.

Komatsu's procedure to identify CSR material issues

In 2010, with the support of Business for Social Responsibility (BSR), a nonprofit organization, Komatsu undertook a materiality
assessment to accomplish the following objectives:
1. Identify a set of CSR issues and prioritize these issues by their relevance to our business and importance to our stakeholders
2. Define a set of global CSR themes and activities
From an extensive list of CSR issues, we selected those relevant to Komatsu as a construction/mining and industrial equipment
manufacturer. We then evaluated CSR issues based on their importance to our business. To understand the relevance of CSR issues toour business, we interviewed senior executives across our company, including the heads of regions outside Japan. These interviews
helped us in understanding the degree to which CSR issues impact our business priorities and operations. To understand the relevanceof CSR issues to our stakeholders, we exchanged opinions with government officials, policy makers, industry experts, media,
construction and mining related customers, suppliers and other stakeholders about the problems identified. Based on their opinions,
we evaluated the CSR issues. We also took into consideration the BSR's view of stakeholder importance.

Evaluating CSR issues
We evaluated CSR issues based on the degree of importance to our business shown on the horizontal axis, and the degree ofimportance to our stakeholders shown on the vertical axis.

The CSR issues in the top right quadrant are considered to be priority CSR issues to both Komatsu’s business operations (our corebusiness) and stakeholders. Focusing on these priority issues will, we believe, lead us to resolve CSR issues through our core businessmost effectively.

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Komatsu's CSR Priorities (Material issues)
Products, Services, and Customers

Products that enhance safety
Responsible marketing and customer support

Environment

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

Employees

Human resource development
Safety and healthRespecting employees

Human Rights

Respecting human rights
Equal employment

Ethics and Governance

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

Local Community

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

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

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

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of LifeCSR Themes

Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

Key Business Activities
Activities through the core businessSocial Contribution Activities

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

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

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

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

Growing with Society• Offer resolutions for social issues throughcollaboration
with stakeholders.
• Act as a responsible corporate citizen ensuringcorporate
governance, compliance, and human rights.

Disaster Relief
Social Contribution utilizing core strength andknow-how

Komatsu's CSR and SDGs (Sustainable Development Goals)
In light of the emphasis on corporate efforts towards ESG (Environmental, Social, Governance), Komatsu announced the Mid-range
Management Plan in April 2016 which stated that Komatsu places emphasis on ESG. In incorporating ESG into the Mid-range
Management Plan, we re-examine the relationship between Komatsu's business and CSR initiatives, reveal the direction we are
currently taking, and how Komatsu's CSR activities link to the SDGs (Sustainable Development Goals) adopted by the United Nations as
a common goal aimed at by the international community.
SDGs (Sustainable Development Goals)
The SDGs, officially known as the 2030 Agenda for Sustainable Development is a set of 17 goals with 169 targets covering a broad
range of sustainable development issues, which was adopted at the United Nations General Assembly in September, 2015.
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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

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

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

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

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

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

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

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Our system to promote Sustainability
In April 2021, Komatsu established the Sustainability Promotion Division under direct control of president to supervise activities
relating to the promotion of the Komatsu Group’s sustainability-oriented management. The Sustainability Promotion Division
enhances the commitment of the entire Komatsu Group to ESG-oriented management with the goal of building an environment forformulating policies and plans regarding two major areas of ESG management, the environment and society, to ensure the divisions
and companies of the Group are able to maintain their commitment to sustainability.
The Sustainability Promotion Committee, chaired by the president, has been established to create opportunities for top management
to regularly discuss our direction toward sustainability.

Global Information Sharing
We provide opportunities for people to exchange opinions and frequently share information regarding the things that Komatsu
believes is the CSR of today. For example, global CSR meetings and virtual meetings are regularly convened including about 30
managers and other people in charge of CSR activities from our overseas subsidiaries. In the future, by collecting various opinions fromvarious areas of the world, we will create a system to comprehensively understand and share what is required on the front lines of thebusiness sites.

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Our concept of environmental activities andpromotion system

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

1. Contributions to Realization of Sustainable Society

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

2. Simultaneous Realization of Environmental and Economic Performance

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

3. Observance of Corporate Social Responsibility

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

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

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

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

1)Climate Change

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

2)Establishment of a Sound Material-Cycle Society

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

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

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

4)Biodiversity

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

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

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

3. Environmental Education and Communication

We believe that it is important to enhance the environmental awareness of each and every employee and thereby actively promote
environmental awareness and education programs for all employees.
We will gather environment-related information concerning not only our manufacturing facilities but also other related entities, such as
major affiliated companies and suppliers, and strive to disclose such information, thereby facilitating proactive communication with all
our stakeholders, such as customers, employees, local communities and suppliers and further expanding the content of environmental
communication.
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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

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

Kanazawa Plant（134KB）

Osaka Plant（71KB）

Oyama Plant（232KB）

Ibaraki Plant（13KB）

Koriyama Plant（180KB）

Himi Plant（194KB）

Hiratsuka district（404KB）

Environmental Policy Test Engineering Center（59KB）

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

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

Application

Products

Construction
Equipment
MiningEquipment
Forestmachines

ObjectCO2

CO2

Production

Domestic
andoverseas
production
basesElectricity

Water
Waste

Japan

CO2

Overseas

CO2

Logistics

External
evaluation--

2030 Targets

FY2020
Achievements
and Progress

2010

50％
reduction

14%
reduction

2010

50%
reduction

33%
reduction

-

50%

13%

2010

60%
reduction

52%
reduction

2010

40%
reduction

35%
reduction

2006

39%
reduction

26%
reduction

2011

22%
reduction

3% reduction-

CDP
A List（Climate,
Water)DJSI World

CDP
Climate：A
Water：A
DJSI World:
Selected

Index
Fuel
Consumption
Reduction
Improvement
rate of basic
unit
Ratio ofrenewableenergy in
totalelectricity
usage
Improvement
rate of basic
unit
Improvement
rate of basic
unit
Improvement
rate of basic
unit
Improvement
rate of basic
unit
External
evaluation
12

Base Year

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

SBT (Science-Based Targets) Approved
Komatsu's CO2reduction objectives have been certified by SBT as of April 11, 2017.
SBT (Science-Based Targets) is an initiative that involves “setting goals that arecompatible with science.”
The COP21 (Paris Agreement) marked the introduction of a new set of CO2reduction
objectives that were submitted by various countries. However, even with thesummation of target values, it was found that it would be impossible for theincrease of average global temperatures in 2100 to be stay within 2℃ (as compared
to temperatures before the Industrial Revolution).
Therefore, after a detailed examination by the businesses of the world, reduction
objectives have been reassessed and SBTi (SBT initiative: CDP, Global Compact,
WRI, WWF) is supporting and approving SBTs to reach the goal of an increase of lessthan 2℃.
Komatsu 's SBT meets the requisites of the temperature increase of less than 2℃
scenario.

Komatsu 's SBT are as follows
1. SCOPE1+2: Base unit -49% (Target Year 2030; Base Year 2010)
2. SCOPE3: Total -46% (Target Year 2030; Base Year 2012)13

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Organizational Chart of the Environmental Management
Structure
Among our important business challenges, the Komatsu Group includes climate change in the objectives of our business strategies.
The Sustainability Promotion Committee and the Risk Management Committee all discuss climate change and provide advice to theStrategy Review Committee and reports to the Board of Directors, who establish a system that realizes appropriate supervision.
In addition, the meeting of executive officers controls progress in the achievement of the objectives.
System for reporting and reviewing environment-related issues, including climate change

Main themes regarding the environment, including climate change
Meeting title

Chairperson

Board of Directors

Chairman of the Board andRepresentative Director

Strategy Review Committee

President

meeting of executive officers

President

Committee

Main themes regarding climate change
Report from the Earth Environment Committee
Report on research, development, product planning, andCTO
Production and procurement report
Mid-Term Management Plan progress report
Growth strategies at main production plants (including
climate change related strategies)
Report from the Earth Environment Committee
Progress in product development and (including climatechange related KPI)

Chairperson

Sustainability Promotion
Committee

President

Risk Management Committee

Executive officer supervising
general affairs

Main themes regarding climate change
ESG initiatives, priority issue and KPI-related issue reports
and deliberatons
CSR activity report
Report on measures to address natural disaster risks*The Earth Environment Committee and the CSR Committee have been merged as the Sustainability Promotion Committee since
FY2021.
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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

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

ISO14001:2015
Domestic Integrated Certification《Komatsu ISO Certification Status》 *Except KMC
From
Production sites in Japan and other countries began to acquire1997
certifications individually.
2008
The Komatsu Group in Japan acquires integrated certification.
2015
Main production sites* in overseas countries achieve 100% certification.
Sales and service divisions are added to integrated certification in Japan.
From2018: Komatsu Customer Support Japan Ltd.
20182019: Four bases (Nagoya, Osaka, Hiroshima, Fukuoka) of Komatsu
Industries Corp.
*Except KMC: KMC has been carring out internal audits by specialists from KMC or
Komatsu headquarters.

Scope of the Integrated Certification in Japan
Scope of the Integrated Certification in Japan (152KB)

Global Operations List of certified sites
Global Operations List of certified sites（108KB）

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Dialogue with Our Stakeholders
Creating a Variety of Opportunities for Dialogue

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

Customers

Business Partners

Distributors

Employees

Local Community

Examples of Meetings andActivities

Purposes
Collaborate to realize customers'
goals and fulfill corporate
responsibility
Collaborate to resolve issues insociety and in the regions where we
operate, and participate in local
activities
President explains businessperformances, policies andstrategies
Conduct safety patrols and provide
opportunities such as for support ofefforts for obtaining certification
Explanation by the President on
business performance, policies andstrategies

Brand Management Activities

Frequency
Daily
Daily

Various meetings with Midori-kai

2 times a year
As needed

Explanation by the President
business performance, policies andstrategies
Dialogue with the labor union andemployee representatives toimprove the workplaceenvironment
Explanation of initiatives related tooperations, the environment andsafetyActivities to resolve local issues
based on employee suggestions

16

Distributor meetings in each region

Annually

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

2 times a year

Regular Meetings between
Management and Labor Union

As needed

Meetings with residents of the local
community near the plant

As needed

Voluntary activities by employees

Daily

As needed

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Stakeholders
Industry-Academia
Collaboration Partners

Investors

Individual
Shareholders

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Examples of Meetings andActivities

Purposes
Exchange of ideas and opinions
between representatives such asuniversity professors and our Chief
Technology Officer
CEO and CFO explanation ofbusiness performance, policies andstrategies
Respond to inquiries and SRI
surveys
CEO and CFO explanation ofbusiness performance, policies andstrategies
Plant tours and explanation ofoperations

17

Frequency

Komatsu Science and Technology
Collaboration Council

Biannually

IR Meetings

Japan: Daily
USA and Europe:
Annually

SRI Surveys

Daily

Shareholders Meetings

2 times a year, held inJapanPlant tours for shareholders

About twice a year inJapan

ESG Databook 2021

Theme 1 :Enhancing
Quality of LifeManagement ofEnvironmental andSocial Initiatives

Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

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

ESG Solutions through Three Pillars of Growth Strategies

Enhancing Quality of Life
—Providing Products
Required by Society—

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

CSR Themes
Enhancing
Quality ofLife —
Providing
Products
Required bySociety—

Key Initiatives under New Mid-Term
FY2021 KPIs
Management Plan
Reduction of CO2 emissions (in comparison to FY2010)● Reduction of CO2 emissions fromproduct use (fuel-efficiency
equipment, hybrid hydraulic excavator, 16% reduction (inrate of Smart Construction use,comparison toenhancement of ICT-intensive
FY2010)construction, mine automation, andunderground mining equipment)● Reduction of CO2 emissions from
40% reduction (inproduction (plants with zero impact on comparison to
FY2010)environment and workers)
Plants with zero impact on environment and workers● Rate of renewable energy use(including purchase of renewable
15％
energy)18

FY2019Performance

Relevant SDGs

FY2020 Performance

14% reduction

14% reduction

33% reduction

33% reduction

11%

13%

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

CSR Themes
Enhancing
Quality ofLife —
Providing
Products
Required bySociety—

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Key Initiatives under New Mid-Term
Management Plan

FY2021 KPIs

Data

SocialContribution
Activities

FY2019Performance

30% reduction (incomparison to
10.7% reduction
FY2018)55% reduction (in● Water consumption
comparison to49.4% reduction
FY2010)
Value chain reforms and redefinition of the aftermarket business
11% increase
3% increase● Spare parts sales● Reman component lifespan(compared to new components)
20,000 workhours 26,866 workhours
Actual value: Average operating time (100% of new(134% of newfrom the nth to the n+1st overhaul
components)
components)
order
Assurance of mine operation safety and productivity● AHS units’ population (promotion of
380 units
221 units
mining platform business)(aggregate)
DANTOTSU Product, DANTOTSU Service, and DANTOTSU Solution● ICT-intensive equipment
units (perintroduced(United States, Europe, and 1,590
1,361 units
year)
Australia)
Work environment burden
coefficient (particle matter density)
●

Index

FY2020 Performance
24% reduction
52% reduction
8% decrease
19,106 workhours (95%of new components)

352 units

1,288 units

Sites adopting Smart Construction 4,850 (per year)
2,440
3,348
Automation, automamous operation, electrification, and remote-controlling of equipmenttion
Test introduction Verification tests
1. Automation of construction
verificationof hydraulicconducted on user In-houseequipment
excavators for
tests
automated loading sites
Preparations
Domestic pretest of
Entry
into
mining
2. Automation, autonomous operation, bulldozer
advanced to launch bulldozer with level 3
and remote operation of mining
mining bulldozer
automation, preparation
market(level4equipmentwith level 2
for proof of concept test
automation)
automationin Australia
Development ofEntry into retrofit
Development of
peripheral safetymarket for installing
3. Automation of utility equipment
technology fortechnologies forperipheral safetyautomated forklifts supporting
functions in preparation
automation
for automation
Advancement ofdevelopment
Expansion of product● Enhancement of mining equipment
Expansion ofseries (drills, LHD) Four
projects forand hard rock mining businesses
product series
expanding product models
series●19

ESG Databook 2021

Theme 1 :Enhancing
Quality of LifeManagement ofEnvironmental andSocial Initiatives

CSR Themes

Enhancing
Quality ofLife —
Providing
Products
Required bySociety—

Creation of construction equipment
demand in agricultural field●

Smart forestry projects
IoT and ICT work reforms● Sales in Kom-mics platform business(visualization of production equipment
operation)●

Data

SocialContribution
Activities

Index

FY2021 KPIs

FY2019Performance

FY2020 Performance

Japan:
Expand lineup of
agricultural loaders
Indonesia:
Increase number ofusers of agricultural
techniques
employing
agricultural
bulldozers

Japan:
Commencement ofverification tests atfive agriculturebusiness operators
Indonesia:
Started mass
production andsales of D31PLL
agricultural
bulldozer
10

Japan:Development andmarket evaluation ofagricultural ATT
Indonesia:
Confirmation offeasibility of D21
agricultural bulldozer
for direct rice
planting applications
19

865 units

1,447 units

50
1,900 units(including forinternal use)

ESG Solutions through Three Pillars of Growth Strategies
Develop a diverse workforce with a high level of productivity and technicalskills.
Strengthen and develop diverse talent with a global perspective to help
achieve sustainable workplaces.
Develop talent with cross-value chain capabilities.

Relevant SDGs

Key Initiatives under New Mid-Term
FY2019FY2021
KPIs
Management Plan
Performance
Development of a diverse workforce with a high level of productivity and technical skills

FY2020
Performance

Developing People

Developing
PeopleTheme 3 :Growing with Society

Key Initiatives under New Mid-Term
Management Plan
Agricultural solutions and smart forestry

CSR Themes

CSR Themes

Theme 2 :Developing People●

Enhancing employee engagement

Improvement of
global surveys andindexes

Total workhours ofless than 2,100;● Work process reforms through expansion
introduction ofof diverse and flexible workstyles
telework system(Japan)20

Scheduled for
FY2020(1) 1,950 workhours
per person/year(2) Commencementof trial in August
2019

Preparation forsurvey in FY2020,
global survey inApril 2021
(1) 1,920
workhours perperson/year(2) Revision of
telework system
in August 2020

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

CSR Themes
Developing
PeopleTheme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Key Initiatives under New Mid-Term
Management Plan

Data

SocialContribution
Activities

Index

FY2020
Performance• Training hours:• Training hours:
33,188 hours
31,625hours
Training hours and (aggregate hours for (aggregate hours
fornumber of● Promotion of The KOMATSU Way (global
allparticipants)
all participants)
participants
dissemination of The KOMATSU Way)•
Numberof(Disclosure of• Number ofparticipants: 1,461 participants:
results)in Japan, 307
1,527 in Japan, 0overseas
overseas
Strengthening and development of diverse talent with a global perspective to help achieve sustainable
workplaces• Revision of
Shifting of humandomestic
resources toretirement, wage,
projects andand retirement
Human resource● Revision of role of Japan in global
improvement
benefit systems
systemrevisionsactivities;
managementin April 2021
started in Japan
globalization of• Introduction oforganizations on byelectivefunction basis
retirement andR&D staff systems
Preparations
Commencement● Foundations for global measures
Introduction
advanced forof domestic data(systems, frameworks)
introduction
linkage● Empowerment of female employees ((1)
non-consolidated ratio of female
employees, (2) non-consolidated ratio of
female managers, (3) consolidated ratio of
female managers (Japan))● Rate of employment of people withdisabilities (comply with requirements inJapan)

Support for regional human resource
development for job creation (regional
human resource development with
Cummins Inc.)●

FY2021 KPIs

FY2019Performance(1) 12.5%, (2) 10.0%, (1) 12.3%, (2) 7.2%,
and (3) 5.0%
and (3) 4.5%

(1) 12.3%, (2)7.7%, and (3)4.9%Above 2.3% (legally
mandated rate)

2.58% (nonconsolidated)

2.82% (nonconsolidated)

Chile, Australia,
South Africa, others• Human resource
development
program launchedin Chile• Ongoing support
provided in Peru,
South Africa, andAustralia• Participants’success in finding
employment
tracked• Ongoingsupport in Chile,
South Africa, andAustralia• Establishment ofscholarshipprogram forstudents in Chileand Peru as partof COVID-19 relief
programDevelopment of talent with cross-value chain capabilities
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ESG Databook 2021

Theme 1 :Enhancing
Quality of LifeManagement ofEnvironmental andSocial Initiatives

CSR Themes
Developing
PeopleGrowing with Society

Growing withSociety

Theme 3 :Growing with Society

Data

Key Initiatives under New Mid-Term
FY2021 KPIs
Management Plan
● Cultivation of Smart Construction
consultants (capable of proposing solutions
using ICT to improve productivity and
430 (aggregate)
safety throughout construction
workplaces)

CSR Themes

CSR Themes

Theme 2 :Developing People

FY2019Performance
396

Index

FY2020
Performance626

ESG Solutions through Three Pillars of Growth Strategies

Relevant SDGs

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

Key Initiatives under New Mid-Term
FY2021 KPIs
Management Plan
Resolutions to social issues through collaboration with stakeholders

Promotion of industry-governmentacademia collaboration as well as ofcollaboration with customers●

SocialContribution
Activities

Promotion of Brand
Management andactivities creating
value for customers

22

FY2019Performance

FY2020
Performance

Examination of
cutting-edge tools
through activities
with domestic
customers andregional
dissemination• Posting of past
activity
documents on
Group portal• Shared
information on
activities in 14
regions on
rotational basis• Continuation ofactivities byheadquarters
team
targeting threecustomers (twocivil engineering,
one aggregate)

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Key Initiatives under New Mid-Term
Management PlanCSR Themes

Data

FY2021 KPIs

SocialContribution
Activities

FY2019Performance• Shareholder
meetings: 2 times• Shareholder
factory tours: 10
Number of meetings times● Shareholders and individual investors
Individual investor(shareholder meetings, shareholder factory held (Disclosure of •meetings:
7 timestours, individual investor meetings)
results)• Certain factory
tours and meetings
canceled due toimpacts of global
COVID-19 pandemic●

Institutional investors (ESG meetings)

Number of meetings 11 (ESG-related
held (Disclosure of meetings)
results)

Communities (business site fairs)

Business fairs atnine factories(Awazu, Osaka,
Kanazawa,
One fair held at each Ibaraki,
Tochigi,of nine factories per Koriyama,Oyama,
Shonan,year
and Himi); canceled
only at Shonan
Plant due to impactsof Typhoon Hagibis

Growing withSociety●

Index

FY2020
Performance• Shareholder
meetings: 1 time
(held online)• Shareholder
factory tours: 0time (canceled
due to COVID-19
pandemic,factory tour
videos shared on
official
Komatsu YouTube
account)• Individual
investor
meetings: 4 times(held online)• ESG-related
meetings: 4• Participation in
conferences: 1(meetings heldwith 18 investors)
All factory fairs
canceled due to
COVID-19
pandemic

29 in Japan
Number of meetings 34 (30 in Japan, 4(canceled● Employees (meetings)
held (Disclosure of overseas)
overseas due toresults)
COVID-19
pandemic)
Action as a responsible corporate citizen addressing corporate governance, compliance, and human rights● Occupational health and safety, support
Revised Komatsu
Ongoing
for establishing environmental and safety improvements
Code ofofsystems at suppliers, response to Japan’s made in reflection Establishment
Worldwide
Human
RightsCorporate Governance Code (corporate
Business Conductof relevant laws and Policy, disclosure
governance reports), evaluations of
Human rights eregulations
andinintegrated
reporteffectiveness of Board of Directors, internal social expectations
learning
control, and internal audits
programs, etc.
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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

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

ISO26000 core
subjects/issues

UNGC 10
Principles

Komatsu's CSR Priorities

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

Human Rights

Human Rights
Principle 1
Principle 2

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

LabourPrinciple 3
Principle 4
Principle 5
Principle 6

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

LabourPractices24

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

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

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

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

ISO26000 core
subjects/issuesThe
Environment

Fair Operating
Practices

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

UNGC 10
Principles

Komatsu's CSR Priorities

Incorporation into Komatsu's Internal
Guidelines■: Items of Komatsu's Worldwide Code ofBusiness Conduct●: Items of Komatsu Group CSR Procurement
Guidelines

Environment
Principle 7
Principle 8
Principle 9

Providing environment-friendly
products, services and solutions
Environmental efficiency(facilities, such as plants andoperation sites)
Remanufacturing

Providing products, services and systems thatare environmentally-conscious■Environmental protection■Komatsu Earth Environmental Charter■Declaration of Conservation of Biodiversity●Reducing environmental impact,
managing chemical substances and building
up environmental management systems

AntiCorruption
Principle 10

Corporate governanceCompliance
Collaboration with business
partners to comply with social
regulations■

Fair and appropriate business operations●Fair and proper relationship with governmental
bodies and agencies■●Never providing, offering or
promising inappropriate money, goods orfavors■●ConsumerIssuesProviding safe products,
services and solutions
Responsible marketing andcustomer care
Providing environment-friendly
products, services and solutions
Remanufacturing

Providing customers with suitable solutions
and striving to deliver products, services andsystems that are safe, environmentallyconscious and innovative■Environmental protection■●Reducing environmental impact,
managing chemical substances and building
up environmental management systems

Community
Involvement
andDevelopment

Development of local
communities
Disaster relief
Improving local residents' qualityof lifeHuman resources development

To fully understand its social responsibilities asa corporate citizen■Groupwide social contribution (5 Basic
Principles for Social Contribution)■●Good harmony with local communities

25

■

■

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

External Evaluations

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index(As of November, 2020)(1) External evaluations for CSR activities (Evaluation for SRI)
[Global][CDP]An NPO that was established in the United Kingdom in 2000 and engages in the surveying
and global disclosure of corporate initiatives with respect to carbon dioxide emissions
and climate change, while simultaneously analyzing and evaluating the surveyed details.
In 2016, it started to run a system aimed at selecting A-list companies, or companies
recognized by the organization as global leaders in terms of the implementation of action
on climate change.
One of the ESG management goals set by Komatsu in “DANTOTSU Value - FORWARD
Together for Sustainable Growth,” the new Mid-Term Management Plan that has been
carried out since fiscal 2019, is to be selected as an A-list company in reference to CDP’s
areas of focus—climate change and water.
[Trends in the selection of the Company over the last three years]
2018

2019

2020

CDP Climate Change

A

A

A

CDP Water

A-

A-

A

[Dow Jones Sustainability Indices (DJSI)]
The sustainability indices were provided by U.S.-based S&P Global Inc. They analyze andevaluate corporate sustainability from the three perspectives of the governance &economic, the environment and the society to select high-ranking companies in eachindustrial sector.
One of the ESG management goals set by Komatsu in “DANTOTSU Value - FORWARD
Together for Sustainable Growth,” the new Mid-Term Management Plan that has been
carried out since fiscal 2019, is to be included in DJSI World.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected as a component of the “World Index” for consecutive years
since 2006.
DJSI

2018

2019

2020

DJSI WorldDJSI WorldDJSI World

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index[MSCI Global Sustainability Indexes*]
The Socially Responsible Investment indexes were developed by U.S.-based MSCI
(Morgan Stanley Capital International), Inc.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected for consecutive years.
[ISS-Oekom]
The corporate sustainability rating indexes were developed by German-based ISS-Oekom.
[Trends in the selection of the Company over the last three years]
Komatsu has been consecutively awarded "Prime" status in the machinery sector.
[EURONEXT VigeoEIRIS]
V.E, an affiliate of Moody’s, is a global leader in ESG assessments, data, research andanalytics.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected for consecutive years.

[Japan][FTSE Blossom Japan Index]
The index, which was established by U.K.-based FTSE Russell, selects Japanesecompanies that implement excellent programs to facilitate ESG.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected for consecutive years.
*FTSE Russell confirms that Komatsu has been independently assessed according to the index criteria, and has satisfied therequirements to become a constituent of the FTSE Blossom Japan Index. Created by the global index and data provider FTSE Russell,
the FTSE Blossom Japan Index is designed to measure the performance of companies demonstrating strong Environmental, Social andGovernance (ESG) practices. The FTSE Blossom Japan Index is used by a wide variety of market participants to create and assess
responsible investment funds and other products.
[MSCI Japan ESG Select Leaders Index*]
The index is part of those established by U.S.-based MSCI Inc., aimed at selecting listed
Japanese companies with high ESG ratings.
[Trends in the selection of the Company over the last three years]
Komatsu has been selected for consecutive years.

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

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

[Certifications][Digital Transformation (DX) Stock Selection 2020 DX Grand Prix 2020]
The Ministry of Economy, Trade and Industry and the Tokyo Stock Exchange (TSE) selectcertain companies listed on TSE as “Digital Transformation (DX) Stocks Selection” for theiraccomplishments achieved by creating internal systems for promoting digitaltransformation (DX)* and excellent use of digital technologies leading to theenhancement of corporate value.
Komatsu has been selected for the fourth time including the “Competitive IT Strategy
Company” implemented until FY2019, and received its first Grand Prix award given to twoof the selected companies in FY2020.
* Digital transformation: A company establishing a competitive advantage by utilizing data and digitaltechnology in response to intense changes in the business environment to transform products services andbusiness models based on the needs of customers and society, and transform operations themselves,organizations, processes and corporate culture.

[SBT]
SBT (Science based targets, namely, science-based emission reduction targets) is an
initiative advocated by the CDP, the United Nations Global Compact, the World Wildlife
Fund and the World Resources Institute. It certifies companies that have establishedreduction targets compatible with scientific knowledge aiming to achieve the target
established under the Paris Agreement of keeping the average rise in global temperature
due to climate change below two degrees from the pre-Industrial Revolution levels in theworst-case scenario.
Komatsu’s CO2 reduction targets were certified as SBT in April 2017.
Please click here for further details about Komatsu's CO2 reduction and SBT.
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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index(2) Evaluations of IR activities[Award for Excellence in Corporate Disclosure from the Securities Analysts
Association of Japan]
Securities analysts developed objective evaluation criteria to decide on the ranking ofcompanies in terms of its quality, quantity, timing and other factors of corporate
disclosures, and based on which established the Award for Excellence in Corporate
Disclosure from the Securities Analysts program. The program has been implemented
since 1955.
Komatsu received the 2018 Award for Excellence in Corporate Disclosure (first place in themachinery section). This is awarded every two years and Komatsu has received it eight
consecutive times-12 times in total.
[2020 Best IR Award]
The Japan Investor Relations Association selects member companies that haveconducted excellent IR activities and provides them with the Best IR Awards. In addition,
it gives the IR Grand Prix Award to companies that have received the Best IR Award for thethird time.
In 2020, Komatsu received the Best IR Award.
This is the seventh time it has received the award, in addition to 2007, 2008, 2010, 2013,2016 and 2017. Also we have received the IR Grand Prix Award twice in 2010 and 2017.

[Tokyo Stock Exchange (TSE) “the Corporate Value Improvement Award” Grand Prix]
TSE created the Award program in FY2012, designed to annually award the companies
which have achieved high corporate value by practicing management of improving
corporate value through initiatives that consider capital cost and other investor concerns.
Komatsu was selected for the Grand Prix award of the 8th Corporate Value Improvement
Award (FY2019) from all listed companies (about 3,650).

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ESG Databook 2021

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

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

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

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ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

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

Outline of the Green Bond
IssuerPricing dateIssue date
Maturity
Issue amountInterest rate

Use of proceeds

Lead manager
Green bondstructuring agent*
RatingKomatsu Ltd.
July 10, 2020
July 16, 2020
5 years
JPY10.0 billion
0.130%
Applicable to the following projects:
Project A: Responses to environmental problems resulting from the use of products
Efforts designed to help reduce CO2 emissions from products in use to 50% by 2030 from 2010(Specifically, R&D, the provision and wide use of products, services and solutions).
1) Products: hybrid hydraulic excavators, (applicable for low carbon-type construction equipment
certification by Japan's Ministry of Land, Infrastructure, Transport and Tourism) and electric
construction equipment.
2) Service: Support for fuel-economy machine operation by using IoT.
3) Solutions: Reduction of CO2 emissions by promoting wide use of ICT-intensive construction
equipment and providing applications which support optimization of construction as a whole.
Project B: Responses to environmental problems resulting from manufacturing.
Efforts designed to help reduce CO2 emissions in manufacturing to 50% and increase the ratio of using
renewal energy to 50% of total energy use, both by 2030 from 2010 (capital investment in facilities andequipment, etc.).
(1) Energy-savings of factories and equipment in plants.
(2) Power generation by using solar panels and biomass as well as purchase of renewable energies.
Nomura Securities Co.,Ltd.
Nomura Securities Co.,Ltd.
"AA-" from Rating and Investment Information, Inc.
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ESG Databook 2021

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index*This organization supports the issuance of green bonds by giving advice regarding the formulation of green bond frameworks and on
obtaining second-party opinions.

Komatsu's green bond frameworks（216KB）

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

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

Reporting
Komatsu reports on the allocation and environmental and social impacts of the proceeds on an annual basis.
In addition, the external review is attached.
Komatsu Green Bond Reporting 2021（260KB）
Green Bond Periodic Review 2021（960KB）
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Theme 1 : Enhancing Quality of Life

Improving Product Safety and Solutions

034

Quality and Reliability - Responsible Commitment to Customers -039

Relationship between Business Activities and the Environment

046

Climate Change048

Our Challenge to establish Recycling-based Society

057

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

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

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

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Example of Safety Activities

Introducing “KomVision Human Detection & Collision Mitigation System” to the JapaneseMarketKomatsu has launched hydraulic excavators*1 equipped with thein-house developed KomVision Human Detection & Collision
Mitigation System as a standard feature for the first time in theindustry in the Japanese market in 2020.
Komatsu has developed this system by upgrading the“KomVision” bird’s eye view camera system equipped withconventional models as standard in the Japanese market. The
system recognizes humans around the excavator and prevents the
motion of the excavator when the system detects people when the
excavator starts to travel or swing. The system also stops the
excavator when it detects humans while the excavator is travelingat slow speeds. With these functions, the system helps curb thepossibility of collisions between the excavator and people.

The PC200-11 equipped with KomVision Human Detection & Collision
Mitigation System

This system comes standard on the PC200-11 model, which
Komatsu began selling in December 2019. Concerning theconventional models already equipped with KomVision as astandard feature, customers can update the software and retrofit
their existing machines*2. With this new system, Komatsu willcontinue to expand support for workplace safety as its goal.
Komatsu will also this system standard in the future on othermodels*3, as it works to gather market needs and provide
customer support in order to further advance its safety support
system.
[Human detection structure of KomVision]
1.All-around machine monitoring with4 cameras and a monitor
Four monocular cameras capture all-around views of the machine, which are shown on the monitor. The operator can select right, rightfront, left or rear views.

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2. Alerting with buzzer and stopping the machine when people are detected
When human are detected inside the detection or stop-controlled area, the system not only displays markers (yellow or red circles) on
the monitor, but also alerts the operator with a buzzer.

*1: Equipped as standard on the PC200/200LC-11, PC210/210LC-11*2: Limited to the models equipped with KomVision for hydraulic excavators. Changing both cameras and software may be needed insome cases.
*3: Komatsu plans to make the system standard on 12 to 40-ton hydraulic excavators (equipped with KomVision) in Japan. Not
applicable to some application-specific models (with a two-piece boom, super-long front boom, slide arm, etc.).
This system is not a device designed to mitigate collisions or detect human under all conditions.
There are limitations on the performance. Accidents are possible when the operator depends too heavily on the system or relies upon it in inappropriate situations.
Never rely solely on this system to avoid collisions.
Before using this system, be sure to read the operator’s manual, and understand and use the system correctly.
This system is not a device to prevent the operator from careless operations, such as operating while looking aside.
This system does not stop the machine’s operation when the machine is travelling or swinging at a high or medium speed, or when the work equipment is inoperation.
The system does not work when work-intended human are located in front or in the working area of work equipment or outside of camera-detectable areas.
The system may not be able to correctly detect people, depending on the conditions of the detection-intended object (e.g., running, squatted, wearing clothes incolors and tones which are not distinguishable from the surroundings), the conditions of the cameras (something attached on the lens, foggy, etc.) and the conditionsof worksites (bad weather, dark, against the light, at night, steamy and smokey, etc.).
Ensure a safe working area around the machine first and then operate the machine, because the system might stop the machine suddenly and put the machine inunstable positions when it is engaged in lifting and traveling, working on steep slopes, or working on slippery surfaces or soft ground. Turn off this system before
loading on or unloading from trailers, because the system might stop the machine suddenly, putting the machine in unstable positions.

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Value Creation by means of Innovation
Value creation by means of innovation is one of three pillars of growth strategy in the mid-term management plan. As one of our focus
efforts in this area, we engaged in automation, autonomous operation, electrification, and remote controlling of construction, mining
and utility equipment (small machinery), while also working to realize digital transformation of construction through both physicalaspects (increased automation and sophistication of construction machinery) and non-physical aspects (optimization of customers’
construction operations), thereby realizing safe, highly productive, smart and clean workplaces of the future with customers. The
Autonomous Haulage System (AHS) for unmanned dump truck operation has already launched in the market, and we have beenstrengthening it further. As of March 31, 2021, a cumulative total of 352 units are in operation. In addition to automation of mining front
lines, we will also advance our building of optimization platforms, aiming to promote increased safety and optimization of operations
for our customers in the mining sector. Furthermore, in November 2020, we conducted Japan’s first successful joint proof of concept
test with NTT DOCOMO INC. for remote operation of a large-scale ICT bulldozer, the D375Ai-8, for mining using a commercial 5th
generation mobile telecommunication protocol (commercial 5G).

Remote operation of large-scale ICT bulldozer D375Ai-8 for mining using commercial 5G Left: Bulldozer located in Oita Prefecture Right: Remote control
panel in TokyoIn April 2020, we started to install “SMARTCONSTRUCTION Retrofit Kits” providing aftermarket ICT functions such as 3D machine
guidance and payload measurement to conventional construction equipment already operating at construction sites in Japan. The kits
can be installed on any hydraulic excavator (6-ton class and above), regardless of the model or manufacturer. From November 2020
onward, the scope of application has been extended to include mini excavators (under 6-ton class) and the kits have been introduced
into the domestic market in Japan by installing them on the Komatsu Group’s
fleet of rental equipment with a view to promoting wider spread use going forward. The Komatsu Group will accelerate the digitaltransformation of construction sites.

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

D61EM-23M0 automated tree planter
901XC eight-wheel ICT-equipped harvester

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

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

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

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

Principles Governing Quality Assurance
1. Putting customers first, being receptive to the views of the customer, and responding appropriately to the customer, thereby
earning the customer's satisfaction, are fundamental to the job of every employee and constitute the responsibility of every
employee.
2. Complying with international standards and the legal requirements particular to individual countries as a matter of course, andproviding products and services that, from the perspective of the customer, have incorporated proper regard for safety and a senseof assurance and that do not easily malfunction, are fundamental to the job of every employee and constitute the responsibility of
every employee.
3. Providing products and services that incorporate proper regard for global environmental conservation is fundamental to the job of
every employee and constitute the responsibility of every employee.
4. Providing products and services that are creative and provide benefits to the customer is fundamental to the job of every employee
and constitute the responsibility of every employee.
5. Giving the customer a sense of safety, assurance, satisfaction, and the ability to use the product for many years to come is a sourceof happiness for every employee.
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Mechanisms for Quality Assurance
Komatsu employees across all areas of our operations, from product planning to development, manufacturing, sales, and after-sales
service, work together as a single cohesive unit to ensure that the products we develop are safe, innovative, and of high quality. Our
unique “monozukuri” system enables the creation and subsequent introduction of highly competitive DANTOTSU products into themarket, whilst maintaining our significant competitive advantage through goods and services with a wide array of substantial features.
Keeping in line with our commitment to product quality and innovation, a variety of meetings are held at each stage of thedevelopment and manufacturing process in order to ensure that our offerings are of the highest possible quality. Through thismeticulous step-by-step process, the product's features are enhanced and refined until it meets the high standards that we adhere to.
Through such approaches, the company is able to strengthen safety assurance and satisfaction for customers while simultaneously
providing products and services that take the global environment into account and comply with both international specifications andthe regulatory requirements of individual countries.

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

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

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

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

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

Quality Assurance Activities at the Global Level
By fully implementing our quality assurance systems on a global level, Komatsu is able to ensure that its products meet a standardized
level of high quality across all countries of operation. Regardless of geographical location, our products are subject to strict, uniform
standards in relation to technical drawings, manufacturing systems, inspection methods, information collection, and quality
management.
Komatsu has a number of manufacturing facilities that it refers to as “mother plants”. These plants have product development
capabilities and serve as the central hub for global product development initiatives using cutting-edge technologies and techniques.
Any form of progress or advancement that is conceived at a “mother plant” is immediately disseminated to other Komatsu
manufacturing locations around the world, creating a uniform ecosystem that promotes technological development and enhances
product quality.
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Standards for Product Safety
Safety and customer trust are at the forefront of all our quality assurance activities. In line with this dedication, Komatsu has
formulated a number of Product Safety Standards and associated principles that all employees are expected to comply with in theexecution of their duties. This enables us to live up to our established reputation by delivering products that exceed customer
expectations in terms of safety, quality, and longevity.

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

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

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

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

Procedure regarding recalls

1. Proposal for rectification of the situation based on information regarding the defect; decision regarding what measures thecompany will take toward the market
2. File a notice with relevant authorities as provided under the law
3. Inform customers through appropriate channels
4. Take appropriate corrective measures including, for example, repairs, replacements, or refunds

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System to deal with recalls appropriately

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

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

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Relationship between Business Activities and theEnvironment
Inputs and outputs in the product life cycle
The Komatsu Group procures various parts and materials and, through the manufacturing process, utilizes the earth's resources,
including raw materials, water, energy, and chemical substances, among others, to provide products to customers. Such businessactivities have the potential to impact the environment at each stage in the process.
The Komatsu Group will continue to provide high value-added products and services while assessing the environmental impacts
resulting from its business activities, formulating medium- and long-term objectives, and introducing measures to reduce suchimpacts.

Environmental Impact Resulting from Business Activities of KomatsuGroup Companies, including Facilities outside Japan (FY2020)
Independent Practitioner's Assurance

Environmental Impact Resulting from Business Activities of Komatsu Group
Companies, including Facilities outside Japan (FY2020)(528KB)

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

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

EnergyWater Resources

Independent Practitioner's Assurance

CO2 （Scope1 and Scope2)

Independent Practitioner's Assurance Waste

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

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

Step1: Reduction of CO2 Emissions through Dantotsu Products
We provide products which have been designed to operate withgreat fuel efficiency while reducing gross CO2 emissions. Komatsu
pioneered the creation and introduction of the hybrid hydraulicexcavator, marked as the first of its kind to be introduced into themarket.
These hybrid construction machines have been certified by the
Ministry of Land, Infrastructure, Transport and Tourism of Japanas a “Low Carbon Type Construction Equipment.”
As of April 2021, a total of 16 of our hybrid models have received
such certification, such as the HB215-3, HB205-3, HB335-3, and
HB365-3.
In addition to this, another 23 of our product models (including
the bulldozer D71PX-24, the hydraulic excavator PC78US-11, thewheel loader WA150-8) have been certified to meet the Ministry ofLand, Infrastructure, Transport and Tourism's “Construction
Machines Fulfilling Fuel Economy Standards” signifying these
HB335-3
products as construction equipment with great fuel efficiency.

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

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

Reducing CO2 Emissions from Product Operation
Komatsu has set the target of reducing the CO2 emissions from the operation of products (construction, mine, and forestry equipment)by 50% by FY2030 (compared to FY2010).
To evaluate progress toward this goal, we compared the performance of the current year’s products to the products of the reference
year (FY2010) and estimated CO2 reductions through the improvement of fuel consumption and work efficiency. The products of FY2020
achieved a CO2 reduction of 14%, compared to the reference year.
CO2 emission index for product operations

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Data

SocialContribution
Activities

Index

The PC1250-11R Large Hydraulic Excavator Featuring Excellent Productivity and Fuel
Efficiency
In December 2020, Komatsu launched the PC1250-11R, a large
hydraulic excavator that incorporates the latest technologies.
Equipped with a new engine that was developed in-house, thislaunch signifies a transition to a new model of Komatsu 120-ton
hydraulic excavator that inherits its core performance andstrength on the market from its predecessor, the PC1250-8, while
also achieving improvements in fuel efficiency, safety and ICT
features such as KOMTRAX Plus, in addition to greater productivity
and safety. The introduction of a new engine increases the power
output of the excavator’s engine. The work modes include theconventional Power (P) and Economy (E) modes, and the
excavator also includes a new Power Plus (P+) mode, which issuitable for high-load operations. This increases the excavator’s
productivity (workload) by 8% over the previous models in the P
mode. The engine’s fuel efficiency has been improved, along with PC1250-11R
a reduction of the losses in the hydraulic circuit and theincorporation of a highly efficient cooling system and an
automatic idling stop function. This has led to a 6% improvementin fuel efficiency versus conventional models even when used inPower (P) mode. The PC1250-11R is equipped with the KomVision
camera system enabling multi-directional visibility around themachine to increase safety and comfort for operators in harshstone crushing and mining worksites. Hydraulic stairway is alsoavailable as a new optional feature.

Development of the 3D95 Engine for PC78US-11/PC88MR-11- New Engine Significantly Improves Environmental Performance Komatsu has brought PC78US-11/PC88MR-11, a new seven-ton-class small hydraulic excavator to market. This high performance,
highly functional and fuel efficient vehicle is equipped with an all new, high-performance 3D95 engine. Developed in-house for the firsttime in 35 years, this engine significantly improves vehicle performance. The 3D95 engine complies with the latest exhaust gas
regulations imposed in Japan, the United States and Europe. Further, it enables the vehicle to achieve dramatic fuel efficiency andreduced CO2 emissions through the 8% reduction of fuel consumption at its rated output versus conventional engines. The smaller sizeof the engine helps decrease the number of components by 27%. The creation of a maintenance free exhaust gas aftertreatment device
that requires no cleaning in Japan and the United States and significantly extends the cleaning interval in Europe contributes to the
reduction of the environmental impact of the engines throughout their lifecycles. We also conduct more than 10,000 hours of tests toensure the superior quality and reliability that Komatsu engines have traditionally been known for. The machine’s downtime has also
been reduced to increase the productivity of worksites where they operate.

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PC78US-11

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Data

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The new 3D95 engine

Reducing CO2 Emissions in Manufacturing Operations
As a part of our efforts to mitigate climate change, Komatsu aims to proactively reduce the amount of CO2 emissions per unit, using CO2
emissions per unit of manufacturing value as our main indicator for the amount of electricity, gas, oil and other types of energy used inresearch/development at our offices and in manufacturing operations.
In FY2019, we set new mid- and long-term objectives globally and have been promoting improvement activities.
Until the third quarter of FY2020, production decreased both in Japan and overseas due to decreasing demand for construction/minemachinery and COVID-19, resulting in a decrease in CO2 emissions. Despite this, the sharp expansion of production in the fourth
quarter led to a slight increase in the unit per internal manufacturing value versus the previous year.
Thanks to energy-saving activities in casting and forging processes, which emit a lot of CO2, new solar power plants, and green
electricity purchases, the CO2 emission intensity per internal manufacturing value was reduced 33%, compared to FY2010, which
achieved the FY2020 objective of a 31% reduction.
In addition, the usage rate of renewable energy increased to 13%, achieving the FY2020 objective (12% or higher) due to purchases ofgreen electricity mainly in Europe and the U.S.
We aim to reduce CO2 emission intensity in FY2021 and later, focusing on the CO2 emission reduction project for casting and forging
processes.
Item

FY2019FY2020Target of FY2030

CO2 Emissions Basic Unit (compared FY2010)

67

67

50

The rate of renewable energy use

11％

13％

50％

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Major Achivements in the previous fiscal year
Japan
Saving energy by renovating component plants
Addition of new biomass boilers
Overseas
Increased purchasing of green electricity
Saving energy by optimizing melting furnace operations

CO2 emissions, energy indicators in production activities
CO2 Emissions

Independent Practitioner's Assurance

The amount and ratio of renewable energy
Independent Practitioner's Assurance

Note: Partially revised as a result of revisions to past data.

Energy consumption
Assurance

Independent Practitioner's

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Reducing CO2 Emissions Using Biomass and Contributing to Local Forestry (Ibaraki Plant)
Komatsu is also introducing renewable energy with the goal of
reducing CO2 emissions. In 2015, a biomass cogeneration systembegan operating fully at the Awazu Plant in collaboration with thelocal forestry cooperative. After that, in 2020, the Ibaraki Plant also
started using biomass in its biomass boiler that uses high-quality
wooden chips with lower water content. The heat obtained fromcombustion is used to control the air temperature at welding
worksites. By doing this, the plant has shifted from conventional,
electricity-based air temperature control and reduced CO2
emissions by about 138 tons a year. The plant partners with the
Ibaraki Pref. Federation of Forest Owners' Cooperative Association for the wood chips that it uses, utilizing theprefecture’s underutilized timber from forest thinning. This is asustainable business practice that helps revitalize the local
forestry industry. Going forward, the plant is planning to introduce Ibaraki Plant biomass boiler
a power generation facility that uses biomass gasification tofurther reduce CO2 emissions. This will involve obtaining fuel bygasifying the wooden chips to generate power. In this way, theplant will stimulate the utilization of local forest resources andincrease the percentage of renewable energy in its production
activities as it pushes forward with efforts to reduce CO2 emissions
and address ESG issues at the same time.

Reducing CO2 Emissions Through Photovoltaic Power Generation (KCCM in China)
About 88% of the CO2 emissions from the Komatsu (Changzhou)
Construction Machinery Corp. (KCCM) plant in China are from theconsumption of electric power. KCCM continues its power
conservation efforts and believes that the introduction ofrenewable energy is a mid- and long-term priority activity for the
reduction of CO2 emissions. KCCM requested a specialist to
calculate the strength of its plant’s roof and has implemented fiveprojects to install 3.2-megawatt photovoltaic power generation
systems from 2019 to 2021. In 2020, the plant completed theinstallation of equipment at three facilities capable of generating a
total of 1.6 MW. The three facilities began generating power inJanuary, May, and October. As of March 2021, a total of about
1,010 MWh has been generated since the facilities began operatingin January 2020. In FY2020, about 13% of all electricity consumed
Photovoltaic power generation equipment installed on the roof of theby the plant was generated by photovoltaic power generators,
contributing to significant reduction of CO2 emissions. KCCM will KCCM plant in China
install an additional 1.6-megawatt photovoltaic power generation
facility and continue to encourage the use of renewable energy.

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Reduction CO2 Emissions in Logistics

CO2 Emissions Reduction Conditions in Global Transport(Basic Unit of CO2 Emissions per Cargo Weight: kg-CO2/ton)Domestically, we have continued to focus on reducing transportation distance by increasing the utilization rate of Kanazawa and
Hitachi Naka Ports (which are located adjacent to manufacturing plants), as well as improving long distance and overlandtransportation through the use of coastal vessels and railways (modal shift). In FY2020, these efforts led to an improvement in the basic
unit index (CO2 emission intensity per workload) of 1.5% versus FY2019.
Overseas, we had a 3.6% improvement versus FY2019 as the modal shift progressed well in North America.
CO2 Emissions in Transport

Independent Practitioner's Assurance* A basic unit index is an index relative to the CO2 emissions per cargo weight in a reference year (2006 for Japan, 2011
for Overseas) as 100.

Improvement of CO2 Emissions from Domestic Transportation
Accelerating the Modal Shift Through the Use of JR Freight for Interplant Transportation
Komatsu strongly promotes the modal shift. This fiscal year, we reviewed the way components are sent from the Oyama Plant to the
Awazu Plant. We resumed JR freight transportation (Utsunomiya Terminal → Osaka Terminal → Kanazawa Terminal), which we expect
will substantially reduce the burdens on truck drivers and significantly reduce CO2 emissions. Consequently, about 35% of thecomponents bound for Awazu have been switched to transportation via JR freight by the end of the fiscal year. This led to a 421
tons/year reduction of CO2 emissions and emissions from domestic transportation were reduced by 2.1%.

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

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

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

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For others, including the 14 remaining categories, general CO2 emissions was calculated. The result is shown in the pie chart below.
(Amount of CO2 Emissions by Scope3)
Independent Practitioner's Assurance*1 LCA refers to the environmental impact assessment method for individual products at each stage, from manufacture, transportation, sale, use,
disposal, to reuse*2 Scope 1 refers to direct CO2 emissions by operators (ex: fuel consumption)*3 Scope 2 refers to indirect CO2 emissions by operators (ex: power purchase)*4 Scope 3 refers to CO2 emissions by operators from within our supply chain (ex: emissions of product during operation, emissions from suppliers,transportation, business trips and commuting)* Calculating each category, the amount was calculated domestically and overseas. The amount of category (4): "Upstream Transportation disposal" wastotal of domestic and a part of overseas. In category (3): "Fuel Procurement", a part of data in overseas was estimated. The amount of category (13):"Downstream Leased Assets Operation" was included in category (11).

As evident from the results above, emissions during product use make up approximately 90% of total emissions.
From this, we can see that fuel-efficient products have a significant effect on reducing CO2 emissions.
Komatsu is committed to developing hybrid construction machinery (improving fuel efficiency by 25%) and DANTOTSU products (over
10% improvement in fuel efficiency). In addition to this, we are accelerating the development and implementation of our ICT-based
SMART CONSTRUCTION business.
In addition, the results of our assessments regarding LCA * 1 (Life Cycle Assessment) can be found in the pie chart below.
«Reference» Pie Chart of Scope1, 2, 3

Independent Practitioner's Assurance

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Our Challenge to establish Recycling-based Society
Development of our “Reman” Remanufacturing BusinessOur “Reman” business involves the remanufacturing of used engines, transmissions, and other key components of construction andmining equipment into “Remanned” components. After confirming that these remanufactured parts are possessed of the same quality
as newly manufactured components, we inject them back into the market. We currently promote the “Reman business at 14 “Reman”
Centers worldwide.
We have established the Reman-Net, which connects Reman centers with one another, and K-WINS, which shares Reman technologicalinformation, and are actively using them for the global expansion of Reman operations and reuse/recycling. In addition, by using IC
tags and two-dimensional codes, we manage the recycling history of remanned components to control quality and obtain durability
data, and then provide feedback that is important for Komatsu to develop components with optimal lifespans.
Quality and performance that matches new components
Lower cost for "remanned" components
Reduced idle time for construction equipment because of adequate inventory of "remanned" components
Resource conservation and waste reduction through reuse and recycling of components

Changes in Reman Sales (base FY2004 = 100)

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Reman Factories and Centers map

Reman Process

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Reman Advances Resource Recycling- A New Reman Plant Opens in South Africa to Strengthen Komatsu’s Recycled Components
Business Komatsu opened a new Reman (remanufacturing) plant on the head office campus of Komatsu Africa Holdings (Pty)* in Johannesburg,
South Africa. The plant will be a central hub for Reman’s remanufacturing business in Southern Africa and will provide high-quality,
efficient recycled components to customers in the region. The Reman Plant pursues the improvement of quality by clearly separating
the areas, one area for the cleaning, disassembling, and testing of soil- and oil-smeared components from machines that have operated
in mines to handle soil- and oil-smeared components, and the other for the assembly area which requires a high level of cleanliness. At
the same time, the plant increases the readiness to efficiently undertake the entire process of receiving, cleaning, disassembling,
testing, reassembling and shipping components, so that it can quickly provide high-quality remanufactured components. The Remanbusiness also engages in 3R (reduce, reuse and recycle) activities to reduce waste by reusing and recycling components and contributes
to resource recycling. The plant recycles and reuses about 14 of the 16 tons of components in the rear wheel transmissions of supersize
dump trucks in service in Southern Africa. Annually, it remanufactures about 14 thousand tons of components.
* The head office campus of Komatsu Africa Holdings is the collective term for the head office building, component depot, workshop, training center,
Reman and many other discrete functions in a single location

Komatsu Africa Holdings’ new Reman building

Supersize electric dump truck

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

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Activities to Effectively Utilize Resources in Production (1. Waste)
Komatsu promotes activities to reduce waste discharged from its production activities while also implementing "zero emission"
activities to recycle and effectively use the generated waste.
We set a new medium-term global goal in FY2019 and began waste reduction activities mainly at bases with metal-casting processes,
which generate approximately 70% of the entire waste volume. By turning waste into a valuable commodity and improving themethods for management of metal-casting waste sand, the waste generated per unit of production recorded a 35% reduction from
FY2010 levels. After 2021, we will promote waste reduction activities primarily at foundries in Japan and overseas to meet new
medium-term targets.

Item

FY2019Index of waste generated per unit
(Reference year: 2010)

FY202077

Target of FY2030
65

60

Major achievements in the previous fiscal year
《Japan》
Reduction of wood chips through packing mode improvements for items procured overseas
Expansion of activities to turn waste plastics, oils, etc. into valuable commodities
Expansion and promotion of waste sorting through the establishment of a recycling center
Recycling of forge scale《Overseas》
Reduction of sand waste by sorting waste containing dust

Waste indicators in production activities
Amount of Generated Waste

Independent Practitioner's Assurance

Note: Partially revised as a result of revisions to past data.

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Recycling Forge-scale from Awazu Plant for Use as Raw Material for casting at Himi Plant
FForge-scale is the iron oxide that develops on the surface of a forged productduring the forging processes performed by the Defense Systems Division at the
Awazu Plant. In the past, this scale was entirely regarded as industrial waste andwas disposed of accordingly. To reduce the amount of waste, the Himi plantfocused on the fact that forge-scale is iron oxide and began to recycle it to use it
as raw material in the Himi Plant’s casting processes. To use forge-scale (ironoxide) as raw material in the dissolution processes during casting, the AwazuHimi
Plant began to simultaneously add aluminum and, through a thermite reaction(reduction of metallic oxide by aluminum), use the iron oxide as raw material for
casting. This generates reaction heat when the aluminum reduces the iron oxide,and simultaneously saves energy in dissolution processes. Repeated
Recycled forge-scale (iron oxide)
experimentation with due consideration for safety led to the reduction of theentire amount of forge-scale produced annually to zero. This eliminated about 15
tons of waste that would have been generated by the Awazu Plant. Further, thereaction heat from thermite reaction helped to reduce the power consumption of
the melting furnace by 27,000 kWh annually, leading to the reduction of CO2
emissions. The Awazu and Himi Plants cooperated with each other to achieve asignificant reduction of the amounts of waste disposed and power consumed forheating.

Activities to Effectively Utilize Resources in Production (2. Water
Resources)
In FY2019, we set new global mid-term targets for water usage in our domestic and overseas manufacturing facilities and launchedinitiatives to reduce water consumption.
In FY2020, We reduced water use per unit of internal manufacturing by 52% compared to FY2010 by reducing waste through the re-use
of water within processes and daily management with a focus on sites in the Hokuriku area that use a lot of groundwater.
We will promote further water usage reduction activities domestically and overseas to meet a new medium-term target after 2021.
Item

FY2019Index of water input volume per unit
(Reference year: 2010)

FY202049

Target of FY2030
48

40

Major achievements in the previous fiscal year
《Japan》
Reduction of water leakage by renovating aged aboveground and underground water piping
Reduction of wash water through the use of membrane filtration devices《Overseas》
Reduction of clean water consumption through the use of recycled water

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Water Use Indicators in Production Activities
Water Input Volume

Independent Practitioner's Assurance

Note: Partially revised as a result of revisions to past data.

Using a Membrane Filtration Device to maintain the cleanliness of Cleaning Liquids
longer(Reducing Waste and Water Consumption at the Koriyama Plant)
The Koriyama Plant operates about 39 washing machines to remove dirt and oilfrom components before assembly, coating and after the processing hydraulicmachines and other pieces of equipment. This required the cleaning liquids to bechanged regularly to maintain their cleanliness. The replaced liquids werecollected as alkaline industrial waste, which accounted for nearly 30% of
industrial waste of the entire plant. The introduction of a membrane filtration
device enables the removal of oil and impurities within the membrane module
while recirculating the cleaning liquid back to the tank. The filtered cleaning
liquid maintains cleanliness, thus decreasing the frequency of changing theliquid and reducing the amount of alkaline industrial waste. The decrease in thefrequency of changing the liquid also reduces water consumption and burdens
Membrane filtration device
on the water supply. In the plant’s activities, different washing machines sharethe membrane filtration device and the extended cleanliness of the machines’
cleaning liquids helps reduce environmental impact.

Recycling Water to Reduce Tap Water Consumption (Komatsu Indonesia)
Komatsu Indonesia believes that it bears social responsibilities in the efforts toprovide clean water to support urban living in the rapidly growing city of Jakarta
and to preserve water resources for future generations. For this purpose,
Komatsu Indonesia recycled the wastewater, which is from the washingmachines used in its production activities and from mosques, toilets, staff
restaurants and other sources, by physical, chemical, and biological treatment tomake it available for use as domestic water and commercial recycled water usedin production activities. Since FY2012, Komatsu Indonesia has recycled
wastewater under the management of the environmental safety division. During Komatsu Indonesia’s wastewater recycling facility
dry season, when it runs short of water, the company also uses water from thereservoir, provided that certain conditions have been met. This has helped
reduce the consumption of city water in 2020 by 69% compared to 2010 and thepercentage of water recycled has reached 73%.
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Personnel Policy and Performance Appraisal System

064

Diversity Initiatives

070

Work-Life Balance and Diverse Workstyles

076

Employee Training Structure080

Enhancing the KOMATSU Way

082

Strengthening Our "Gemba" Capability

085

Brand Management Initiatives

087

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

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

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

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

Condition of Labor Unions
Having signed the United Nations Global Compact, Komatsu recognizes that freedom of association and the right to collective
bargaining are intrinsic human rights that must be respected. Our engagements with labor unions thus reflect this commitment,
showcasing our dedication to ensuring the best for our people. We have a labor contract with the Komatsu Labor Union, which isorganized by approximately 11,100 of our employees across 8 of our Japanese branches. The Union employs a union-shop system, andthe percentage of employees who are union members (number of unionized employees / total number of employees including
management and other non-unionized employees) is 79.7%.
The Komatsu Labor Union is a member of its superior body, the All Komatsu Workers Union and a superior industry labor union, theJapanese Association of Metal, Machinery, and Manufacturing Workers. 12 of our consolidated subsidiaries and affiliates in Japan havelabor contracts with a labor union that has joined the "All Komatsu Workers Union", making up a total of approximately 6,800
employees.
In addition to this, Komatsu continues to comply with legislation related to labor rights, while responding in an honest and transparent
manner to all dialogues and discussions with individual employees and their representatives.

Harassment Prevention Initiative
Komatsu Group is committed to eliminating and preventing every type of harassment. Each of our offices has a consultation desk tohandle harassment-related issues and we are developing our readiness to promptly react to problems whenever they occur. Regularly
providing harassment prevention training to all employees deepens each employee’s understanding of harassment and helps to build
workplaces that enable employees to work safely and healthily and to stay considerate of each other’s perspectives.

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Facts about the initiative in FY2020
Number of harassment-related reports
received (in Japan)

50

Harassment prevention training (in Japan)(e-learning and group learning)

Basic education *Based on the revision of the Act on Comprehensive
Promotion of Labor Policies
Stratified training
Director and executive officer training
Managerial-level refresher training
New managerial-level employee training
Deputy manager training
Third- and seventh-year employee training
New employee training

Creating a vibrant workplace with rewarding jobs
Ensuring employees stay engaged is essential for the sustainable growth of a company. In April 2021, a global engagement survey of thedomestic and overseas companies of the Komatsu Group was conducted as part of the Group’s efforts to regularly identify and analyze
employee engagement and reflect these findings in our HR measures to address ever-changing challenges. Through the analysis ofsurvey results by region and organization, we will identify Komatsu’s strengths and problems and reflect these results in our HR
measures, training programs and other related activities in pursuit of our being company where people are vibrantly empowered.

Overview of employee awareness survey in FY2021
Number of
respondent

72% of the Employees of Komatsu and its Group companies in Japan and other countries responded

Objectives

To regularly identify and analyze employee engagement, clarify our strengths and challenges at thattime and take them into consideration when discussing and deciding plans for the future

Survey overview

Sixty questions about employee engagement and subjects that may influence it, such as vision,
strategic and competitive advantages, leadership and corporate climate and work environment

Methodology

Anonymous online survey

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Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

DATA

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

（1）Number of employees (Non-consolidated basis)
FY2018FY2019FY2020Total

11,537

11,692

11,795Male

10,175

10,305

10,404

Female

1,362

1,387

1,391

（2）Number of employees (Consolidated basis)
FY2018FY2019FY2020Consolidated

61,90862,82361,564

Non-Japanese(consolidated)

42,34942,94841,573（3）Average age
FY2018FY2019FY2020

Total

39.6

39.5

39.8

Male

39.7

39.6

39.8

Female

39.3

39.3

39.2

（4）Years of continuous employment
FY2018FY2019FY2020

Total

14.3

15.1

15.3

Male

14.7

15.4

15.6

Female

11.9

12.8

12.8

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Theme 2 :Developing People

Theme 3 :Growing with Society

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Activities

Data

Index

（5）Annual total remuneration (average)
FY2018
Total(Yen)FY20197,608,424

FY20207,467,775

7,186,395*Minimum wages set by age（6）Number of employees by age
Total

Male

FemaleUnder 30

2,194

1,799

395

30-39

3,793

3,521

272

40-49

3,163

2,808

355

50-59

2,645

2,276

369

Total

11,795

10,404

1,391（7）New graduates employment
College graduate
Year(April)Junior college graduate

Total

Male

Female

Total

Male

2019

195

169

26

25

22

2020

221

194

27

27

2021

157

135

22

16

High-school graduate

Female

Total

Male

Female

3

132

99

33

18

9

114

86

28

14

2

81

62

19

（8）Mid-career employment (As of May 10th, 2021)
Total

CollegemaleCollegefemale

Other
male

Other
femaleThe ratio of the number of Mid-careeremployment
to the number of total employment

April 2018March 2019

140

55

15

59

11

31%

April 2019March 2020

200

74

16

97

13

36%

April 2020March 2021

57

14

5

30

8

14%

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Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

（9）Employee turnover (April 2020-March 2021)
Total
Number of employee
turnover(Total employee turnoverrate/Voluntary employee
turnover rate)

Male

141
(1.08%/0.86%)

Female12219（10）Retention of new employees
MaleFemaleNew employees (April 2018)

248

61

Enrollment (April 2021)

239

59

Turnover rate: 3.6%; 9 males, 2 females（11）Diversity of management
Male

FemaleFemale Parcentage

Foreign employees

Management position

1,606

143

8.2%

14

General managers

377

13

3.3%

0

Directors and officers

45

3

6.7%

7

Executive officers(Domestic)

26

2

7.1%

7

Executive officers(Overseas)

15

0

0%

0

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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

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Activities

Index

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

Strengthening the Development of Global Talent
Approach and Goals

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

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Theme 2 :Developing People

Theme 3 :Growing with Society

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Systems and Status in FY2020
Human Resource Development

Komatsu’s human resources development programs include the two following programs:
1. Global Engineer Training Program
The Komatsu Human Resources Development Center was set up in the Philippines in November 2008 to be an educational
institution specialized in the development of engineers capable of globally providing product support. It became a local affiliate
and was renamed Komatsu Philippines Corporation in November 2019 to expand the engineer development system. The affiliate
has trained more than 150 engineers. A nearly six-year training program is provided around the world and the graduates whocomplete the program become Global Engineers employed by the company that are active around the world.
2. AI Human Resources Development Program
Domestically, artificial intelligence (AI) will become increasingly indispensable in the delivery of DANTOTSU Service and DANTOTSU
Solutions to customers and the reform of our development and production processes. To facilitate the use of AI, we started the AI
Human Resources Development Program in 2019. The program uses our original curriculum with the goal of developing humanresources with the technical skills in AI, business acumen and problem-solving capabilities necessary to put projects into practice.

Management System

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

DATA
FY2019Number of O cers
（Internal Directors
and Executive
O cers）
Number of Global
O cers（Including Executive
O cers）＊As of April 1

FY2020

FY2021

Total

53

50

48

Foreign Nationals

5

6

7

Total

26

29

27

Foreign Nationals

18

19

19

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Theme 2 :Developing People

Theme 3 :Growing with Society

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Promoting Women's Careers

Approach and Goals

Komatsu is promoting various measures including stimulating employment and developing the capabilities of female employees, andthe development of favorable environments for continuous career development after maternity leave. Speaking only of Komatsu on
the non-consolidated basis, a female executive officer was assigned for the first time in April 2011 and a female director was appointed
for the first time in June 2018. However, we are aware that the relatively small number of female managers, compared with malemanagers, is an issue that we particularly need to improve and we should actively promote female employees to more responsible
positions of higher authority, including promotion to managers, and not just supporting work-life balancing events such as giving birth,childcare and nursing care with work.

System and Status in FY2020
We believe that measures to promote the active participation of female employees will lead to the development of a system and thecreation of an environment in which every employee can work comfortably and realize their full potential, so we continue promoting
these measures across the Komatsu Group.
We have held a Diversity & Inclusion Development Seminar for female mangers ofKomatsu and its overseas subsidiaries since FY2018. In this seminar, those thatparticipated deepened their understanding of the history of Komatsu, the KOMATSU Way
and management strategies, and we supported their efforts to be leaders promoting
diversity initiatives in their companies. The seminar will also be held online as many of
our training programs have been shifted to the internet due to the COVID-19 pandemic.
Also in Japan, as a measure to nurture female employees, we have held a career plan
training in which participants think about their future and their work styles. The CDP(Career Development Program), in which female employees formulate their mid to longterm career plans discussing with their supervisors has also been implemented since2015. Starting from 2016 onward, networking/training workshops for female employees
have been held jointly with other companies in the same manufacturing industry.
Furthermore, we have provided female managers with external training regularly since
FY2015 for the cultivation of senior management.
In FY2020, career plan training was also held online. In prior years it was difficult for somecolleagues to attend training programs that required spending many days away fromhome because of reasons such as raising children. Moving career plan training online has
made it possible for these colleagues to participate at their workplace or at home andScene of DIDS training
makes it possible for more employees to receive training. The training program iscurrently designed to be a half day x three days program in an effort to help the
employees balance work and training.

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Theme 2 :Developing People

Theme 3 :Growing with Society

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Data

Index

DATA
FY2019FY2020

FY2021

Number (ratio) of women
employed

1,463 (12.3%)

1,482 (12.3%)

1,486 (12.4%)

Number (ratio) of women
junior managers

172 (11.4％)

178 (11.4％)

179 (10.6％)

Number (ratio) of women in
management positions*Including junior managers

302 (9.1％)

315 (9.5%)

324 (9.4%)

Number (ratio) of women in
executive positions

2 (5.7％)2 (6.9%)2 (7.1%)

Number (ratio) of women
hired

24 (12.8％)

26 (13.3%)

27 (12.2%)* The data for Komatsu Ltd. (non-consolidated) (in Japan). The numbers and rates are for newly hired university graduates. Data as of April 1.

Support for balancing childcare, nursing care and medical treatment
with work
Flexible work styles are spreading, where employees who are involved in childcare or
nursing care can telecommute or take advantage of a short-time work system. As part ofits efforts to support the balancing of childcare and work, the KOMATSU Way Global
Institute, in-house training center in Komatsu, Ishikawa Prefecture, provides a day-care
center service and since 2016, we have been hosting a networking event on the 19th every
month cooperating with labor unions as a place for communication among employees
who are involved in childcare. In addition, at the headquarters, we invited employees’
A photo from the online nursing care seminarchildren for a Work Site Tour which provided work-experience opportunities.
With respect to nursing care, we hold seminars conducted by experts, providing
opportunities for employees to develop their mental attitudes toward nursing care andthink about balancing it with work. In FY2020, seminars were also held online, making iteasier for people from many different backgrounds and from all around the country toparticipate. This helped deepen people’s understanding of nursing care. Since 2018, we
have held monthly consultations for each employee with an expert from outside thecompany, providing support in line with the situation of each employee.
Moreover, from the standpoint of health and safety, a consultation service has been
established at each office so employees can seek advice on the balancing of medical
treatment and work. In 2019, a fertility treatment leave system was introduced, which has
increased options for employees finding a balance between social life and fertility
treatment, and developing a work environment where employees who require medicalcare can work with safety and security.

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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

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Activities

Index

Employing Persons with Disabilities

Approach and Goals

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

Status in FY2021
As of April 2021, the employment ratio of persons with disabilities is 2.89% (non-consolidated basis). With regards to BCC, there are
156 people working at 11 business units. With the expansion of its organization, BCC has taken on matters that had previously been
outsourced, as well as tasks that had been taking up time and effort internally, thereby contributing to efficiency and cost cutting forthe company as a whole.

DATA
FY2019FY2020

FY2021

Employment ratio of persons
with disabilities

2.55％

2.79％

2.89%

Number of BCC locations

11

11

11

Number of BCC staff
members

125

144

156

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

Promoting Hiring of Retired Employees
Approach and Goals

As the aging of Japanese society accelerates, Komatsu is committed to maintaining its efforts to hire more elderly workers.
Komatsu(non-consolidated) introduced a re-employment program in 2006 and revised this system from April 2013 so that as a generalrule all those who desire to do so can work until the age of 65. We also established a Second Career Support Program for employees
who desire to play an active part outside the group, and provide training opportunities, paid leave and monetary aid.
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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

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Activities

Index

DATA
FY2018FY2019FY2020

Number of retired employees

185

206

201

Number of retired employees who were rehiredby Group companies

155

167

174

LGBT Compatibility
Concept and system

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

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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

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Activities

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Work-Life Balance and Diverse Workstyles
Past Endeavors and Status in FY2020
The maintenance of a healthy work-life balance is an integral component in bringing the best out of our employees. Studies haveshown that individuals who are able to nurture a fulfilling personal life alongside their work commitments are both more motivatedand driven, while being able to draw out the full potential of their abilities. With this understanding in mind, Komatsu is working to
reduce the total number of required working hours for our personnel by setting up a number of work-life balance systems to improve
workplace sustainability. We are currently engaged in co-operative undertakings with labor unions in order to formulate specificquantifiable targets to reduce the total number of working hours for our employees. We establish commendable goals of less than
2,100 working hours per year, along with the provision of an average of at least 19 days of paid leave per year for each employee. In
addition, based on compliance with the Article 36 Agreement or agreement on overtime, we are working to realize an efficient way ofworking. In FY2018, we began an interval system that enforces a minimum of 10 hours of rest following long periods of work in order topromote safe and healthy workstyles.
We will stay committed to helping employees establish new and diverse workstyles so that they are able to balance work and theirpersonal lives.

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

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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

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Activities

Index

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

Telework program

Content
Available for a maximum of three years from the birth of the child to the time
the child enters nursery school. Also available for a maximum of three years
for children up to the third grade of elementary school in cases where a
spouse is transferred, etc.
Shortening of working hours by a maximum of three hours per day to allow
for care of children up to the third grade of elementary school
Option to work at home in order to care for children up to the third grade ofelementary school

Allowance toward thecost of using childcare services

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

Child-care leave
Family-care leave
program
Family-care support

Part-time work
Family-care leave
Life support leave

Other types of leave

Flexible leave forrefreshment
Volunteer incentive
programSpousal transfer
occupational leavesystemLeave for infertility
treatment

Five days for nursing care of one child up to the third grade of elementary
school, and ten days for the second child onward (paid leave)
Allowance granted to cover the cost of using child-care services
A maximum of three years available for employees taking care of family
members (possible to take in installments)
Shortening of working hours by a maximum of three hours per day (possible
to take in installments)
Five days per year for attending to one family member in need of nursing
care, and ten days for the second family member onward (paid leave)
Can be used as sick leave, pregnancy leave, child-care leave or for care offamily members. An employee may add five new days of accumulated leave
per year. A maximum of 40 days of unused annual leave may be
accumulated. Child-care leave may be used for school events for children
aged up to third grade in junior high school
Provided to encourage employees to take five consecutive days of leave formental and physical refreshment
Employees receive an additional five days of annual leave and a travel
voucher upon completion of their 15th, 25th and 35th year of continued
serviceLong-term paid leave of up to two years, or short-term paid leave of 12 days
per yearAcquisition for up to three years per spousal transfer (Acquisition up to one
per employee)
Each employee is permitted leave of up to a whole year for infertility
treatment.

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Theme 2 :Developing People

Theme 3 :Growing with Society

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Data

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

Various Incentive Programs
Subsidizing the expense of taking a certification course
Job posting system
Studying in domestic college or study abroad program
Employee awards program for distinguished achievement
In-house language school and subsidizing the expense
Stock option (directors, officers and some executives)

Work-Life Balance Data
Parental leave

FY2018Pregnancy leaves
Child-care leaves (total)
Child-care leaves(paternal leave)
Child-care leaves(within one week leave)
Return rate of employees
from Childcare leave

FY2019FY2020

63
137

59
161

57
163

23

43

51

1

3

1

98.6％

99.4％

98.8%

Family-care leave
FY2018
Family-care leaves

FY20197

FY2020
578

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Theme 1 :Enhancing
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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

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Activities

Index

Paid vacation
FY2018Days granted
Days taken
Ratio

FY2019
20.0
19.5
97.5%

FY2020
20.0
19.9
99.3%

20.0
19.8
98.8％

Volunteer Time Off (VTO)FY2018
Number of VTO users
VTO in long-term

FY201992
0

FY2020
58
0

79

14
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Theme 2 :Developing People

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

System and Status in FY2020
In 2020, due to the influence of covid-19, all training was conducted online.
In 2021, the training curriculum will be divided into lecture-based and group work-based ones, and the lecture-based ones will be
distributed as videos to create a learning environment that suits the convenience of the students.

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Theme 2 :Developing People

Theme 3 :Growing with Society

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Data

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A Case of Employee Training: Manager Refreshment Training
Since 2017, Komatsu has been conducting a specific training program for manager-level personnel, activating a 360 degree
feedback system which requires evaluations from each participant's supervisors, colleagues and other team members. Through thesystem, we aim to promote improvement of communication at the workplace, encouraging all the participants in the training torecognize the gaps in perceptions with others.
All manager-level personnel in Japan are eligible to attend the program. A total of 3,604 managers attended the training program so far
with an attendance rate of over 98%.
The program contributes to preventing abuse of authority and sexual harassment at work from happening by having senior employees
realize that they are apt to have an inter-generational perception gap with employees, especially the younger generations. Managers
who attended the program commented like, “It was a good chance for me to realize how I am perceived by others,” “The program
helped me to understand the gap in generational thinking,” and “The program provided a heads-up, and it helped us to address theissues that we face in the office.” We aim to achieve a 100% attendance rate for the program as soon as possible.

FY20171,185

FY2018FY2019655

FY2020
985

Total
3,604
(Attendance rate:98%)

779

Please refer to the following websites for the contents of programs that were held in 2020

Educational training pertaining to the
KOMATSU Way

Technical Capability of the manufacturing
workplace

Service Personnel HR development

DATA

Employee Training
FY2018Average hours per FTE
Average spent per FTE

FY2019FY2020Non-consolidated

58

53

55

Consolidated

-

-

45

JPY245,000

JPY244,000

JPY195,000--

JPY72,000

Non-consolidated
Consolidated* Calculation of consolidated data started from the FY2020 survey.

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

System and Status in FY2020
The KOMATSU Way finds its roots in the corporate strengths that Komatsu has cultivated over time, culminating in a system of integrity
and strength that is disseminated to group companies on a global scale. This propagation is achieved through the KOMATSU Way
Global Institute, which conducts various publication and human resource development activities.
Employee understanding of the KOMATSU Way is deepened via training sessions and the creation of opportunities for exposition andgroup debates. We foster interpersonal communication between employees at such sessions to minimize generational gaps, allowing
for a more effective "trickle-down" spread of this knowledge. We have also considered the intrinsic differences of foreign cultures, andhave worked to craft the KOMATSU Way in a manner that is both easy to understand and relevant for the international community atlarge. This allows us to promote the KOMATSU Way in domestic and foreign settings, allowing for uniformity across the group.
In FY2020, our overseas affiliates translated the third revision of the KOMATSU Way so that it would be possible for employees to readand understand it in their native languages. Now it is available in nine different languages.
In FY2020, KOMATSU Way and TQM (Total Quality Management) training had to be cancelled in many countries due to the COVID-19
pandemic. However, in the Asian region they were held online, where they would be less affected by time differences.
In the training program divided by job level in Japan, we provided an e-learning program and online training as a part of efforts toprevent infection.
We will stay committed to the development of human resources and will strive to systematically ensure the spread of the KOMATSU
Way and TQM so that they take root globally.
We believe that through these activities, we will be able to foster employees who practice the KOMATSU Way and pass it on to the next
generation, leading to the sustainable growth of the entire Komatsu Group.

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DATA

Educational Training that pertains to KOMATSU WayName of Training
CourseNumber ofparticipants/cases

Course participants

Targets

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

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

Cancelled

0

Education for midlevel managers ofoverseas subsidiaries(KOMATSU Way
Leadership
Development
Program)Mid-level managers ofoverseas subsidiaries
expected to be
responsible for thecore
business/functions

To train up local
leaders who
understand andpractice the KOMATSU
Way

Cancelled

0

KOMATSU Way Expert
Development Program

Mid-level managers ofoverseas subsidiaries
with aptitude

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

Cancelled

0

TQM instructor
training

Mid-level managers ofoverseas subsidiaries
with aptitude

To promote
understanding of QC
at overseas
subsidiaries

Training by Job Level

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

To promote theunderstanding andpractice of the
KOMATSU Way

Year round

1,343 people

Selected from theKomatsu Group in
Japan and overseas

To present
improvement
activities as OJT andstrengthen awarenessof the KOMATSU Way
practices

November 2020 (heldonline)Approximately 9,000
accessAll Komatsu QC
Convention

83

Training dates

Cancelled

0

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

The KOMATSU Way-History of Dissemination Activities

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Theme 1 :Enhancing
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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

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

Enhancing the Technical Capabilities of Our Manufacturing Operations
Systems and Status in FY2020

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

DATA
Status of Human Resource Development at the Manufacturing Gemba
FY2018
All-Komatsu Technology Olympics

All-Komatsu QC Competition

FY2019FY2020

Number ofparticipants

198

200

195

From overseas

39(11 countries)

38(10 countries)

55(2 countries)

Number ofparticipants

93

96

94

From overseas

36(14 countries)

36(14 countries)

35(11 countries)

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Theme 1 :Enhancing
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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Countries of Dispatch in FY2020 to All-Komatsu Technology Olympics and All-Komatsu QC Competition
All-Komatsu Technology Olympics

No contestants were sent to Japan due to COVID-19 pandemic. Russia and China were the only countries where contestants gathered inperson.

All-Komatsu QC Competition

Because of the COVID-19 pandemic, no contestants were sent to Japan and the competition was prerecorded. The United States, Brazil,
Chile, Germany, Italy, Australia, Thailand, Indonesia, India, China and Russia (11 countries)

Service Personnel Human Resource Development

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

TOPICSContinuing to provide training during the COVID-19 pandemic

Due to the COVID-19 pandemic, almost all group sessions at training centers were cancelled or postponed in FY2020. We
organized many lecture activities, mainly including online lectures and the distribution of videos, to develop and improve
digital learning.
When training sessions were held involving the gathering of people from different places, it was necessary to limit the numberof trainees. The use of digital learning has made the training program available anytime and anywhere to more people.
As we head toward a post-COVID era, the training centers will be able to combine socially distanced group sessions with digitallearning to improve the training they provide.

Training activities at the Dubai Training & Demonstration Center in Dubai, UAE“Dubai Training & Demonstration Center” established in Dubai, UAE, aiming at enhancing training functions for distributors in
the Middle East and Africa regions, has provided the training necessary for construction equipment distributors, including
training in sales promotion, parts, services, and machine operations since April 2019.
At the center, Komatsu certified instructors work, and conduct (1) practical training to develop understanding by seeing andexperiencing real machines and equipment, and (2) systematic training globally equivalent in quality. The center not only
provides product and technical training for distributors, but also accommodates a wide range of services such as productdemonstrations and test operations for customers as sales promotion activities, as well as training for operators.
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Theme 1 :Enhancing
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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Brand Management Initiatives
What are Brand Management Initiatives?

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

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

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Theme 1 :Enhancing
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Theme 2 :Developing People

Theme 3 :Growing with Society

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Activities

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Figure 1: Customer relationship chart

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

Figure 2: Relationship level model88

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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

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Recent Activities and Future Plans
In addition to the initial activities in Japan, North America, Chile, South Africa and Australia, we have expanded these activities toinclude China, Southeast Asia, Europe, South America, Oman, the Commonwealth of Independent States and the forestry businesses.
In the process, we have incorporated the above ideas into KOMATSU Way, which is a value that all KOMATSU Group employees should
inherit permanently in the field and workplace, compiling the "KOMATSU Way of Brand Management."
In FY2017, we developed a customer needs stratification sheet to further deepen our insight into "customer perspectives". Through thisuseful tool, we have become able to review customer needs in a clear, hierarchical format, enabling us to perceive what customers wish
to achieve. We also hold workshops on a global scale, focusing on the theme of customer needs.
Brand management activities that began with a focus on stakeholders by our marketing department have expanded into companywide activities that involve our production and development divisions. Owing to the positive strengthening effects it has on our various
departments and human resource development circles, Komatsu will continue to promote brand management activities for theforeseeable future.

Global BM Workshop (Komatsu in Japan, October 2019)89

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Theme 3 : Growing with Society

Corporate Governance Indicators

091

Compliance094

Human Rights Policy

098

Business and Human Rights

100

Risk Management

103

Information Security

108

Occupational Safety and Health110

Outline of Procurement Policy and Supply Chain

119

CSR Procurement Guidelines

123

Support for Member Companies of the Komatsu Midori-kai (Management and Society)131

Our Suppot for Midori-kai member companies（Environment）

139

Safety and environmental initiativesat sales and service companies

144

Environmental Risk Management

146

Biodiversity

155

Communication with Stakeholders

160

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Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

Corporate Governance Indicators* As of March 31, Fiscal-Year end

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

Number of Internal
Directors
Number of
Independent
Directors

Total
Number of Corporate Executive Officers on the Board% of Corporate Executive Officers on the Board% of Independent Directors on the Board% of Women on the Board

Number of Audit &Supervisory Board
Members

Number of Internal
Members
Number of
Independent Members

Women
Men
Total
Women
Men
Total

Members

Members
％
Women
Men
Total
Women
Men
Total

Total
% of Independent Audit & Supervisory Board Members% of Female Audit & Supervisory Board Members
Average Age of Board Members
Term Limits for Board Members
Number of Board Meetings
Board Meeting Attendance
Attendance of Independent Directors at Board Meetings
Number of Directors Attending Less Than 75% of Board Meetings
Number of Audit Committee Meetings
Audit Committee Meeting Attendance

91

Members

％
Age
Years
Times
％
％
Members
Times％

Fiscal
2016
0
7
7
0
3
3
10
6
60
30
0
0
2
2
1
2
3
5
60
20
61.8
1
17
99
98
0
15
97

Fiscal
2017
0
5
5
0
3
3
8
4
50
38
0
0
2
2
1
2
3
5
60
20
63.2
1
15
100
100
0
15
100

Fiscal
2018
1
4
5
0
3
3
8
4
50
38
13
0
2
2
1
2
3
5
60
20
63.2
1
15
100
100
0
15
99

Fiscal
2019
1
4
5
0
3
3
8
4
50
38
13
0
2
2
1
2
3
5
60
20
60.6
1
15
99
100
0
15
100

Fiscal
2020
1
4
5
0
3
3
8
4
50
38
13
0
2
2
1
2
3
5
60
20
61.6
1
15
100
100
0
15
100

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Corporate Governance
Unit
Attendance of Independent Auditors at Board Meetings
Number of Auditors Attending Less Than 75% of Board Meetings
Women
Number of Executive
Men
Officers*Excl. Board Members
Total
Ratio of Female Executive Officers
Women
Number of Executive
Men
Officers(Global Officers)
Total
Women
Number ofMen
Internal Members
Total
Human
Resource Advisory
Women
NumberofCommittee Meｍbers
Independent
Men
Members
Total
Total
Number of Human Resource Advisory Committee Meetings
Human Resource Advisory Committee Meeting Attendance
Women
Number of Internal
MenMembers
Total
Number of Compensation
Women
Advisory Committee Meｍ Number ofbers
Independent
Men
Members
Total
Total
Number of Compensation Advisory Committee Meetings
Compensation Advisory Committee Meeting Attendance

92

SocialContribution
Activities

Data％
Members
Members％
Members

Members

Times％

Members

Times％

Fiscal
2016
96
0
2
32
34
6
0
26
26
0
2
2
0
3
3
5
1
100
0
1
1
1
3
4
5
2
100

Fiscal
2017
100
0
2
30
32
6
0
27
27
0
2
2
0
3
3
5
1
100
0
1
1
1
3
4
5
2
100

Index

Fiscal
2018
98
0
1
29
30
3
0
29
29
0
2
2
0
3
3
5
2
100
0
1
1
1
3
4
5
1
100

Fiscal
2019
100
０
2
31
33
6
0
26
26
0
2
2
0
3
3
5
3
100
0
1
1
1
3
4
5
1
100

Fiscal
2020
100
0
2
26
28
7
0
28
28
0
2
2
0
3
3
5
2
100
0
1
1
1
6
7
8
1
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ESG Databook 2021

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Compensation
Unit

Compensation of Chief
Executive Officer

Compensation of Directors*Excluding External
Directors*Including those who retired
during the term
Compensation of Audit &Supervisory Board
Members*Excluding External Audit &Supervisory Board Members*Including those who retired
during the term

Compensation of External
Directors and External Audit&
Supervisory Board Members

Basic Remuneration
Performance-Based Bonus in
Cash
PerformanceBased Remuneration (StockBased)
Total
Basic Remunerations
Stock Options
Performance-Based Bonuses in
Cash
Performance-BasedRemunerations (Stock-Based)
Total
Basic Remunerations
Stock Options
Performance-Based Bonuses in
Cash
Performance-BasedRemunerations (Stock-Based)
Total
Basic Remunerations
Stock Options
Performance-Based Bonuses in
Cash
Performance-BasedRemunerations (Stock-Based)
Total

SocialContribution
Activities

Data

Millions
of
Yen

Index

Fiscal
2016
100

Fiscal2017
100

Fiscal2018
102

Fiscal2019
103

Fiscal
2020
103

36

73

93

41

28

19

19

99

46

35

155
427
0

192
357
0

294
357
0

190
345
0

166
331
0

154

246

310

130

88

83

68

300

147

108

664
86
0

671
86
0

967
87
0

622
87
0

527
87
0

0

0

0

0

0

0

0

0

0

0

86
85
0

86
85
0

87
103
0

87
108
0

87
109
0

9

9

0

0

0

4

5

0

0

0

98

99

103

108

109

Shareholder Rights
Anti-Takeover Measures
Compliance
Clawback Yes
provision

None

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

Political Contributions

Unit
Millions of Yen

Fiscal 2016

Fiscal 201793

Fiscal 2018

Fiscal 20198

Fiscal 2020
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Theme 2 :Developing People

Theme 3 :Growing with Society

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

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

Komatsu's Worldwide Code of Business Conduct
The company has formulated Komatsu's Worldwide Code of Business Conduct (established in 1998 and revised ten times to date) as acompilation of best business practices to be observed by officers and employees of Komatsu Group companies around the globe.
While Komatsu is expected to achieve its own sound and sustainable growth as a global corporation, a growing number of stakeholders
also expect Komatsu to give due consideration to the environmental and social impacts of its business activities, products and services,and to make positive contributions to the sustainable development of society. Komatsu believes that meeting these expectations is oursocial responsibility as a good corporate citizen, while we seek to find solutions for ESG (Environmental, Social and Governance) issues
through our core business activities. In addition, a positive cycle of solving ESG issues and improving our earnings is expected tofacilitate sustainable growth for Komatsu. Part 1 of “Komatsu’s Worldwide Code of Business Conduct” (the “Code”) provides principles
and standards for responsible business conduct that Komatsu follows to fulfill its social responsibilities. For Komatsu to continue toearn the trust of society, each and every employee of Komatsu is required to act in good faith, ethically and in compliance with laws,
regulations and other rules generally recognized and respected by society (the “Rules”). Accompanied by examples, Part 2 of the Codecontains select universally applicable rules which set the code of conduct that must be followed by all employees of Komatsu.
“Komatsu’s Worldwide Code of Business Conduct” consists of two major parts. The first part clarifies the Komatsu Group's compliancepolicy and declares that executives and managers of each Komatsu Group company comply with it. The second part specificallydescribes what all Komatsu employees worldwide should and should not do in order to comply with the rules of the business industry
as individuals. We explain easy-to-understand examples of basic ethics in business operations, antitrust laws and anti-corruption.
Komatsu considers CSR as a key responsibility, which is shown by Komatsu's Worldwide Code of Business Conduct clearly focusing on
the importance of CSR. Turning a PDCA cycle of (1) formulating a code of conduct, (2) implementing the code, (3) determining whether
and how the code is following and (4) reacting to contingencies for corrections and preventing recurrences of problems is the pillar of
Komatsu's compliance activities.
Komatsu's Worldwide Code of Business Conduct is available at:
Komatsu's Worldwide Code of Business Conduct
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Theme 2 :Developing People

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Process for Compliance Activities
1. Formulate the Code:
Formulate the Code and the Five Principles of Compliance as a foundation for compliance activities and revise the Code (currently
in its 11th edition) as required to reflect social change.
2. Implement the Code:
Implement the Code through education that corresponds to employee rank and their respective duties, and by communicating
information in accordance with the Code.
3. Determine the current status:
Determine whether we comply with rules of business society by having all business units regularly report on their use of the Code,
implementing compliance and risk audits, conducting "visualization survey" of potential risks and enhancing Komatsu's internalreporting system.
4. Reacting to contingencies:
Any issues identified during the above activities or otherwise will be addressed in accordance with the Code and be rectified
through implemented preventive measures.

Upholding Thorough Compliance
So that employees remain acutely aware of compliance all the time, the Group is working to cultivate their consciousness of best
business practices by displaying business unit posters in every Komatsu Group listing The Five Principles of Compliance (a condensed
version of Komatsu's Code of Worldwide Business Conduct). For employee education, we have been expanding global e-learning sincethe 10th edition of Komatsu's Code of Worldwide Business Conduct to help employees around the world understand the Code.
Preparations are also underway for education on the 11th edition issued in April 2021. In addition, group training on compliance isconducted in Japan and is divided into managers and general employees. In addition, we are expanding business-specific compliancetraining, and individual training in response to requests from departments. Furthermore, as training for risks for overseas operations,education on anti-corruption, antitrust laws, export control and more is provided to prospective employees to be based abroad.
We have established a "Compliance Portal" on our intranet to ensure wide-spread awareness. The monthly magazine "Everybody’sCompliance" provides explanations of important laws, lessons learned from other companies, and articles on human rights,
harassment prevention and traffic rules for general business-related practices. Articles on anti-corruption, antitrust laws, and export
control have been repeatedly published as particularly important fields. By issuing compliance-related journals, we also expand
awareness-raising activities for our overseas affiliates. In this way, we are committed on a global scale.
The Group strives to detect risks early and implement reforms at Komatsu business units and Group companies through monitoring
during financial audits and compliance and risk audits. The monitoring covers compliance in highly important areas such as safety andenvironmental practices.

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Internal Reporting System
Komatsu has established the Global Compliance Hotline in its HQ to offer counselling to and handle reports from employees ofKomatsu Group companies pertaining to the rules in the business world. In this way, we strive to detect and correct problems early. In
addition, Komatsu companies establish and maintain Regional Compliance Hotline that properly handles compliance of alleged orsuspectied violation of the Rules so that whistleblowers can raise claims in their native languages. Please note that reports directed to
Global Compliance Hotlline will be forwarded to the corresponding Regional Compliace Hotline for investigation and application of theRules. The Global Compliance Hotline will monitor how the report is handled by the employee in charge of the Regional Compliace
Hotline, with the goal of assuring global possess across the globe. The Group actively encourages consultations and reporting throughKomatsu's Worldwide Code of Business Conduct, the Five Principles of Compliance, and Group companies' workplace rules, making it
clear that employees who use the system for appropriate reporting will not be treated unfairly in any way as a result of their action.
The contact persons on the Global Compliance Hotline discuss the handling of all consultations and reports to ensure they are handledappropriately. They also participate in training sessions and workshops to improve their skills in handling reports.

Status in FY2020
No incidents of note occurred during 2020.

DATA

1. Number of Internal Reports
FY2018
Number of Internal Reports(number of serious cases)

FY2019134 (0)

FY2020141 (0)89 (0)

2. About Komatsu's Worldwide Code of Business Conduct
Established

January 1, 1998

Last revised

April 1, 2021 (11th edition)

Languages

20 languages (Planning)
Japanese, English, Chinese, Spanish, Portuguese, German, Dutch, Italian, Polish, French,
Swedish, Finnish, Indonesian, Thai, Russian, Turkish, Persian, Tamil, Taiwanese, Korean96

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3. Compliance Education in FY2020
Global training on the code of
conduct (e-learning and grouptraining)

Approx. 13,400 people<Group training (mainly Japan)>・Level-based training
・Individual training by
request(offices and relatedcompanies in Japan)

Approx. 1,600 people
Approx. 1,300 people

4. Compliance violation in FY2020
No compliance violation had a significant impact on the management of the company.

5. With regards to anti-corruption
Number of employees who weredismissed because of conflict with
Komatsu's anti-corruption policy(global)Fiscal Year 2020: ZeroFines imposed on Komatsu related
to corruption / Amount of penalties(global)Fiscal Year 2020: ZeroFiscal year 2020: 12 times
Target audience: Approximately 90 (planned to be transferred overseas)

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

Establishment of internal reporting
system related to corruption(global)Prevention of corruption is specified in "Komatsu's Worldwide Code of Business Conduct"as a key priority issue. If there is any suspicion or concern involving corruption or theviolation of business society rules, concerned parties are invited to use the Global
Compliance Hotlines established at the Komatsu Head Office or within each region toreport the problem.
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Theme 2 :Developing People

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Human Rights Policy
In September 2019, Komatsu established our Human Rights Policy and declared that we endeavor to conduct our business respecting
human rights in compliance with the United Nations Guiding Principles on Business and Human Rights, and to apply respect for humanrights in accordance with international standards throughout our global organization. Based on this policy, Komatsu develops andimplements measures to prevent and mitigate negative impacts on human rights, and further improves its processes to correct
potential negative impacts on human rights.
This human rights policy has been incorporated into the Komatsu Code of Conduct (revised in 2021) and is thoroughly communicatedby all Komatsu Group employees worldwide.

Human Rights Policy
1. Respect for Human Rights
The Komatsu Way describes the values that all officers and employees in the Komatsu Group, including those at top
management level, should inherit in a lasting way. To implement the Komatsu Way, it is necessary that we act responsiblyin accordance with the expectations of society. Komatsu believes that it is essential to ensure that respect for humanrights is firmly embedded within our company and therefore applies the human rights policy to Komatsu’s worldwide
operations to conduct its business. This policy is formulated based on international human rights principles encompassedby the Universal Declaration of Human Rights. In addition to promoting business activities in line with this philosophy,
Komatsu promotes activities that respect human rights such as the prevention of child labor and forced labor and theelimination of excessive working hours, the prevention of discrimination and harassment, the right to freedom of
association, the right to collective bargaining, minimum wage, health & safety, etc., in accordance with the “United
Nations (UN) Guiding Principles on Business and Human Rights” and the “ILO Core Labour Standards”. Komatsu Group willcomply with the laws and regulations of all countries where it conducts its business activities. Where establishedinternational human rights norm exists as well as national laws, we will follow the higher standard; where they are in
conflict and will seek ways to respect internationally recognized human rights to the greatest extent possible.
2. Stakeholder Engagement
When we talk about “stakeholders”, we refer collectively to all parties that are affected by our business activities.
Stakeholders include customers, shareholders, investors, distributors, suppliers, local communities and employees. We
will consult with independent external knowledge on human rights issues and respect dialogue and discussions withinternal and external stakeholders to understand human rights related issues. We will regularly and publicly communicate
our activities on human rights based on this policy through our reports and/or Group website.
3. Local Communities
Companies cannot continue to exist without maintaining good harmony with the local community. Komatsu wishes to be
the most transparent company which actively seeks harmonious balance of interests with the local communities throughclose communication and contributes to the local communities as a valued corporate citizen.
4. Human Rights Issues (Assessment and Due Diligence)
In our effort to apply the major principles for protecting human rights, we conduct human rights risk assessments for our
existing and new construction/mining equipment and forestry machinery businesses worldwide with the help of external
experts. In addition to risk assessments, we will conduct CSR procurement assessments for suppliers and promote CSR
procurement through improvement activities based on the results of the assessments.
5. Guidance for Employees, Distributors and Suppliers
In order to ensure the effectiveness of this policy, we will conduct appropriate training and activities to raise awareness in
employees throughout the Group. We will also expect and encourage our distributors and suppliers to comply with thispolicy in their own operations.
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6. Remedy
We have established and maintained a Global Compliance Hotline at our headquarters to take reports relating to noncompliance, including regarding human rights issues and make this Hotline number known to all Komatsu Group
employees. Any employee who believes a conflict arises between this policy and the laws, customs or practices of theplace where he or she works, or who has questions about this policy or would like to confidentially report a potential
violation of this policy, should raise those questions and concerns with the Hotline anonymously. In addition to the
Hotline for Komatsu Group employees, anyone other than Komatsu Group employees who become aware of any
circumstance or action that violates or appears to violate this policy or applicable law with respect to human rights, canfile a report anonymously. They can contact us at https://www.komatsu.jp/en/inquiry/ or call at +81-3-5561-4711.

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Business and Human Rights
1. Formulation of human rights policy
In September 2019, Komatsu established our Human Rights Policy and declared that we endeavor to conduct our business respecting
human rights in compliance with the United Nations Guiding Principles on Business and Human Rights, and to apply respect for humanrights in accordance with international standards throughout our global organization. Based on this policy, Komatsu develops andimplements measures to prevent and mitigate negative impacts on human rights, and further improves its processes to correct
potential negative impacts on human rights.
This human rights policy has been incorporated into the Komatsu Code of Conduct (revised in 2021) and is thoroughly communicatedby all Komatsu Group employees worldwide.

2. Implementation of human rights due diligence
By continuing to implement the following human rights process, we will identify human rights issues in our business, and clarify
specific operational procedures for dealing with each issue.

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Risk assessment is a step in assessing and identifying human rights risks that may be affected by business activities and has been
conducted as follows.
2014

With the support of BSR (Business for Social Responsibility), an external expert, we conducted a risk assessment of
human rights issues for our global construction, mining, and forestry equipment business.

2017

Conducted the second human rights risk assessment with the cooperation of BSR. In conducting the assessment, wereferred to the Universal Declaration of Human Rights and the UN Guiding Principles on Business and Human Rights.

2020

With the support of CSR Europe, an external expert, we conducted a systematic global human rights risk assessmentof our downstream business (sales of equipment and spare parts) in construction, mining, and forestry equipment
business. Based on the characteristics of our business, we assessed and prioritized risks from multiple perspectives,
including discrimination based on race, ethnicity, and country of origin, and forced labor, freedom of association, andfair labor conditions to identify and prioritised potential issues for each business sector and region.

(2) Implementation of screening
In our global operations, we have established a screening system to check and regulate transactions with partners designated specified
in our sanction lists and other documents. We are ensuring compliance with international laws and regulations (such as embargoes).
We are currently investigating ways to expand the scope of this system to include responsible sales approaches and policies.

(3) Deployment to employees and agentsTo inseminate our human rights policies within our employees and to raise awareness of preventive and mitigation measures against
negative impacts, we have launched an e-learning program in July 2020 and starting with employees in Japan and the United States,
we will expand this to our employees worldwide.
We do not have ownership in many of our distributors that sell and service our products worldwide, but we added the clause in our
distributorship agreements in which our partners will "respect human rights in the business". We are also engaged in dialogue withthese business partners on the formulation of human rights policies and the implementation of voluntary due diligence in line with therealities of their respective regions and businesses.

(4) Deployment to the supply chain
As part of its efforts to ensure that its suppliers respect human rights, we endevour our CSR Procurement Guidelines to penetrate into
our daily procurement operations. And in fiscal 2020, we also started to conduct SAQ (Self Assessment Questionnaire) on CSR
activities including human rights, among our primary suppliers in Japan and overseas, in order to further promote CSR in our supply
chain. In fiscal 2020, we started the survey on 156 companies of “Midori Kai” suppliers in Japan, and we have received responses from77 companies so far.
For more information, please visit https://komatsu.disclosure.site/en/themes/185.

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In line with our corporate social responsibilities, Komatsu does not condone the use of conflict materials produced by the Democratic
Republic of Congo (DRC), or its neighbors (Angola, Republic of Burundi, Central African Republic, Republic of the Congo, Rwanda, South
Sudan, Tanzania, Uganda and Zambia). We have informed our business partners of this policy through the Komatsu Green Procurement
Guidelines. Working hand-in-hand with suppliers, we conducted a country-of-origin survey to determine the location of origin of ourmaterials and to ensure that none of them are sourced from areas of conflict.
[UK Modern Slavery Act]In response to the "Modern Slavery Act 2015" being enacted by the UK in October 2015, Komatsu UK Ltd. revised its “Slavery and
Human Trafficking Statement for the Financial Year 2015.” disclosed on the web site. Recognizing the possibility of the risk of humanrights violations occurring in Komatsu's business operations and its supply chains, this statement reports how such an issue will beproperly managed.

Komatsu UK Ltd. website(5)Remedies
Komatsu has established a "Global Compliance Hotline" at its head office, which can be used to report any violation of human rights
issues, and has made this hotline known to all Komatsu Group employees. The hotline also accepts reports of violations or suspectedviolations of human rights policies and laws, as well as reports of non-compliance or suspected non-compliance in procurement
activities, to whom anyone can contact anonymously if he or she becomes aware of facts that may indicate a violation or suspectedviolation.
The "Five Principles of Compliance," which all Komatsu Group companies and their employees must follow, making it clear that
employees who use the system for appropriate reporting will not be treated unfairly in any way as a result of their action.

(6)Monitoring and communication
In the "Komatsu Code of Conduct," we declare that we shall disclose appropriate information on Komatsu's business operations to ourshareholders, investors and other stakeholders to the extent permissible under the relevant laws, regulations and contracts with third
parties, and subject to appropriate protection of trade secrets and other confidential information. We will also proactively disclose
relevant information on human rights issues to improve transparency and fairness.
In addition, we believe that an approach to regional and economic development in those areas will also contribute to remediation.
Through human resource development utilizing our core skills, we continue to focus on education at training centers around the world,and support regional vocational training schools through our social contribution programs in ways such as providing curriculums andtraining tools. This will also support the safe deployment of the machines and reduces further the risks for accidents and misuse.
Examples of specific activities
Since 2019, we have conducted due diligence on Myanmar with the support of external experts, to identify the issues and discuss how
we approach those issues. As a result, we made a decision in 2019 to terminate sales of mining equipment to the jade mining market in
Myanmar. We also terminated the operations of "Komatsu Manufacturing Myanmar", our subsidiary engaging in mining equipment
maintenance. We have since been in the process of liquidating the company. We will continue to work further with our distributors andexternal experts in Myanmar to take effective measures to strengthen respect for human rights in our operations.

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

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

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2. Specific initiatives in FY2020

Establishing a business continuity plan (BCP) and providing training
Komatsu has established a BCP to continue or quickly restore important operations. We implemented initial response training at eachbase in Japan to improve their risk management level and their ability to respond to disasters. We have introduced the safety checksystem to promptly check the safety of employees and their families when a disaster or accident occurs as well as wide-area wirelessdevices and other tools at each base of the group. Through regular safety reporting and communication training, we are enhancing the
emergency communication capabilities of the entire group. Each base in Japan also conducts regular training to ensure thatappropriate actions are taken during a disaster by role-playing the occurrence of a large earthquake or flooding, in an effort to ensurethat appropriate actions are taken in the event of a disaster.
Furthermore, considering the recent frequent occurrence of large natural disasters, each of our bases is seismically reinforcing
buildings and facilities and enhancing countermeasures against concentrated heavy rains based on their own plans. We are focused on
not only strengthening the BCP of each base of the Komatsu Group but also strengthening the supply chain system through our
support of our business partners as they establish and improve their BCPs. In FY2020, we held three remote seminars for our business
partners with the participation of about 70 companies. The seminars were mainly about the first actions to take in the event of adisaster and the standard efforts for increasing emergency preparedness. Komatsu will continue to promote and enhance our Groupwide BCP initiatives.

BCP training

BCP training at Osaka Plant

BCP training at Awazu Plant

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Response to the COVID-19 coronavirus
To fulfill its responsibilities to its customers engaged in essential businesses supporting social infrastructure, the Komatsu Group takes
thorough measures to prevent infection as it continues to supply of products, parts and services to its customers. In March 2020, an
emergency task force led by our president was established. The task force met, shared information globally and reviewed andexpanded policies to prevent the spread of infectious diseases. (The emergency task force met a total of 79 times as of March 2021.)(1) COVID-19 and fluctuation of demand
COVID-19 triggered the declaration of a state of emergency in many countries and led to restrictions being placed on economic
activities that have impacted the operations of Komatsu and its customers. The degree of infection and recovery is different in eachcountry. In China, one of the first countries to domestically manage the pandemic, we capitalized on the demand that was growing
significantly and, in the first period of FY2020, our sales outperformed those of the same period of the previous year. In other regions,however, the stagnation of economic activity caused a significant downturn in demand and overall sales fell below those of the same
period of the previous year. From the second period of FY2020, the status of operation of machinery has returned to a usual level inmany different regions despite some variation. In Indonesia, Thailand and Malaysia, the steady recovery of demand was recognizable
mainly for general construction equipment. In Oceania, mine construction equipment for iron ore and general construction equipment
enjoyed steady demand and their sales increased year-on-year. However, overall sales for the full business year fell below the level ofthe previous business year.
Demand for construction and mine resources, which support social infrastructure, is recovering despite some variations among
regions. Demand for our products is estimated to return to its previous level. But the impact of COVID-19 may last longer than expected.
There has been a resurgence of COVID-19 infections in Europe and India and there is no telling when the pandemic will end.
(2) Efforts to continue business activities
The production activities of some Komatsu plants were affected by the lockdowns and other measures ordered by local governments.
To adapt to regional variations in demand and to exchange rates, Komatsu has implemented cross-sourcing enabling its production
activities to be flexibly performed at plants around the world. This initiative functioned effectively as the COVID-19 pandemic began. We
took measures to address risks relating to the supply of parts from our suppliers, such as leveraging our global network to
preferentially allocate stock in the supply chain to underserved regions. Further, we developed alternative products and secured
suppliers to ensure that sales opportunities were not missed, a potential result of a stockout of parts.
(3) Measures to prevent infection at workplaces
We prioritize the safety and health of our customers, business partners, community, employees and their families as we work toprevent COVID-19 infections in compliance with the related policies of national governments.
In Japan, we encourage employees to telework, and about 70% of the employees at our head office divisions teleworked during thestates of emergency. In those times, domestic travel, events, training and seminars were basically canceled or postponed, and all inhouse training programs were basically shifted online.
Our production sites took measures including providing thorough ventilation using placed fans and open windows, increasing thenumber of lounges and staggering break times, to prevent infections from spreading inside a workplace.
(4) Providing information to stakeholders
To prevent COVID-19 infections, Komatsu has aggressively encouraged the use of online communications. In December 2020, we had
our first-ever online shareholder meeting and engaged in dialog with shareholders and answered questions in real time. In June 2021,
our General Meeting of Shareholders was held online for first time.
Our website includes video of virtual tours of the Awazu and Ibaraki Plants, enabling viewers to drag the image displayed on the screen
to view a 360° image of the process of assembling a construction machine from any angle they wish. The video conveys the atmosphereof Komatsu’s worksites as they engage in monozukuri.
Virtual plant tour video

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Ibaraki Plant(5) Digitally transforming construction sites to protect customers from infection
Through its solution business, Komatsu has increased the productivity and safety of our customers’ construction sites using digitalconstruction technology. Our customers’ need to avoid the three Cs (closed spaces, crowded places, and close-contact settings) on
their worksites during and after the pandemic may tangibly impact us in ways such as the increase demand for remote control
products, automation and unmanned operations, and there may be intangible aspects such as the rapid acceleration of thedigitalization of construction and digital twin technology.
Japan’s Ministry of Land, Infrastructure, Transport and Tourism recommended measures to avoid the three Cs at construction sites, andas a part of these efforts, Komatsu believes that on-site digital twins are a solution for the prevention of COVID-19 infections at its
customers’ sites. It involves a digital transformation to leverage smart construction to enable people involved to stay on top of what ishappening at the site remotely, so that it is not necessary for workers to gather in one location.

Quickly create point-cloud data of the current topography of a worksite and create a digital twin from 3D topography data in the app
provided by Komatsu to enable the people involved to stay on top of the progress of construction, even when they are far away fromthe site, and to take action when presented with problems.

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

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Information Security
Cyberattacks and other threats to Information security are growing more advanced and sophisticated. They highlight the increasing
importance of information security measures. Komatsu’s Worldwide Code of Business Conduct states that, based on the understandingthat information and information infrastructure are valuable assets of the Komatsu Group, the companies of the Komatsu Group must
follow applicable laws and in-house rules and ensure that each individual employee properly protects and manages information.
Komatsu takes measures to comply with the Information Security Regulations and other rules and regulations.
In FY2020, no serious incidents concerning information security, such as the leakage of personal data, occurred within the KomatsuGroup.

1. Risk management and its promotion
As a part of the management system led by the risk management supervisor, the Risk Management Committee shares and discusses
company-wide information security issues. The president of the Information Strategy Division, who is also a leader in charge of ICT, isthe vice-chairperson of the Risk Management Committee so that it is able to address more specialized areas of information security.
The Committee shares and resolves more important information security issues. Whenever a serious issue emerges, it will be swiftly
reported to officers including the president and directors, the Board of Directors and other organizations concerned, and appropriate
actions will be taken.
The Information Strategy Division formulates measures to address information security risks as necessary and annually presents themto the Strategy Review Committee consisting of officers including the president and directors. These measures would be included in the
mid-term ICT investment plan.

2. Protection of personal data
Komatsu believes that appropriately protecting the personal data of its customers, business partners, employees and others is a social
responsibility it bears. Komatsu formulates and publishes its principles for the protection of personal data. Through the e-learning
opportunities, internal audits and other activities, we thoroughly ensure the appropriate handling of personal data. Overseas, we adapt
our efforts to protect personal data to national and regional laws such as the EU’s General Data Protection Regulation (GDPR) and the
expectations of society.

3. System measures
Komatsu has built a multilayer defense system combining many system measures to protect information from unauthorized access,virus infection and other threats and to prevent the leakage of data resulting from these threats. For example, we have multiple
required processes whenever a person accesses the system from the outside to telework to strictly authenticate individual users.

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4. Education and training
All Komatsu employees must take regular e-learning courses to increase the knowledge and awareness of all employees handling data
and to ensure they are able to handle data properly.
To address the risk of suspicious emails, we organize multiple drills every year where employees simulate the handling of targetedemail attacks. Suspicious email drills are also conducted at some affiliates both in Japan and overseas. We are working globally to raise
the level of our information security.
Course title

Target (in Japan)

e-learning data security (basic)

New employees including new graduates and mid-career workers

e-learning data security (reacting to new
threats)

All employees using computers and other information devices

Targeted email attack drill

All employees using computers and other information devices (partly including
overseas employees)

5. Information security auditing
The information security of Komatsu Group companies is audited to increase the level of information security throughout the KomatsuGroup. Komatsu employees with specialized knowledge audit and advise to increase the effectiveness of these efforts. Conducting
audits as a third party with no direct interests helps to ensure independence and impartiality.
In principle, the information security of each group company is audited every three years and Komatsu stays updated on the status of
the information security of the group companies.

6. Efforts to improve information security throughout the supply chain
Komatsu asks its employees, Komatsu Group companies and other companies that cooperate in our supply chain with whom we shareconfidential business information to follow Komatsu’s information security principles as we continue to effectively support them.
Komatsu and everyone involved in its businesses that handles confidential business information share an understanding of theimportance of properly managing data. We all work to minimize risk in pursuit of stable business continuity. To this end, we engage inactivities such as regular interviews of cooperating companies regarding the status of their data management, presenting, whereappropriate, inspection items regarding the business data kept in information technology equipment and recommending information
security teaching materials.

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

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

Message from the President Concerning Occupational Safety and Health

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

Occupational Safety and Health Policies(Released as a part of the Komatsu's Worldwide Code of Business Conduct on April 1, 2011)
1. Observe the laws and regulations concerning occupational safety and health as well as internal rules, key items common to
the Komatsu Group about occupational safety and health, and particularly items agreed as a result of labor-management
consultations in each workplace.
2. Set up targets for activities based on occupational safety and health policies, review their progress, and endeavor tocontinuously improve and enhance occupational safety and health activities.
3. Carry out occupational safety and health activities in management-and-labor partnership on a full participation basis andkeep good communication with stakeholders with regard to occupational safety and health.
4. Identify and evaluate the risk for occupational safety and health of a workplace and take appropriate actions accordingly.
5. Actively promote employees' healthcare management and support the maintenance and promotion of employees' health.
6. Actively promote education, training and qualification acquisition necessary for employees' occupational safety and healthactivities, and endeavor to develop human resources for safely carrying out their responsibilities in the workplace.
7. Subject to appropriate protection of personal information, publicly offer the knowledge and information aboutoccupational safety and health activities obtained through the business activities in order to secure safety and health insociety.
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In addition to our existing health management programs, the Komatsu Group strives to create a corporate Health Culture and has beenpromoting its Five-Year Health Development Plan, a medium-term health development plan that was established in FY2014 and theSecond Health Development Plan which was established in FY2019. The goal of the Health Culture is: to look after one's own healthand the health of one's colleagues, and to consider and take action on what is necessary for leading a better life. The president
announced the Komatsu Health Declaration in June 2014 to effectively promote this goal. The declaration was revised in April 2019.

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

Organization

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

This conference convenes with the aim to increase awareness regarding Safety and Health for employees of the Komatsu Group andpartner companies while raising the level of Safety and Health activities. The conference engages in activities that help all theparticipants to share the policy, priorities and best practices of Safety and Health activities, and incorporate these practices into thedaily operations at other divisions. This is also the administration of presidential awards related to Safety and Health.

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

This committee was formed to enhance cooperation between labor and management to examine, discuss and make decisions on
measures aimed at eliminating risks in workplaces and preventing health risks. This committee formulates regulations concerning
Safety and Health, examines, debates and decides on related policies for the fiscal year. This is also the occasion to manage theprogress of these activities.
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Major items to be examined and discussed:
The formulation of safety and hygiene regulations.
An action plan for the fiscal year, and activity progress management.

Conference for Safety and Health in the Community

We shall share and discuss information on safety, health, and the environment in each region globally, leading it to the safe and healthy
activities of each overseas subsidiary. In FY2020, we held the conferences in North America, Europe and China.

Group Health Representatives Meeting

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

Health Promotion Committee

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

Safety and Health Key Initiatives of Komatsu Group in FY2020[Safety and Health Management]
1. Activities to maintain and raise the management system for labor safety and health
2. Promoting risk management activities
3. Promoting the improvement of work and working environments
4. Promoting daily activities with the participation of all employees
5. Enriching safety and health education
6. Promoting Global and Group-wide safety and health activities
7. Enhancing compliance risk management
8. Enhancing safety and health activities at sales bases
9. Preventing traffic accidents[Health Management]
We are promoting health management activities for the following in accordance with the Second Heath Development Plan:
1. Cancer and lifestyle diseases
2. Tobacco-related diseases
3. Mental health
4. Occupational diseases
5. First aid and infectious diseases
6. Diversity tasks
7. Lifestyle improvement

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Working to achieve the Second Health Development PlanIn FY2020, we pushed forward the Second Health Development Plan established in April 2019. The Second Heath Development Plan,
while continuing the activities of the previous medium-term plan, has promoted the creation of a life-long culture of health byestablishing a system that helps the employees voluntarily practice "healthy actions" through the enhancement of support structures
for the balance of work and health, primary preventative actions (lifestyle improvement), and the introduction of ICT tools, etc. Major
accomplishments in FY2020 are listed below:
Item

Initiative

Cancer andlifestylediseases

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

Initiative

FY2019resultFY2020resultGoals(FY2019FY2021)

Milestone checkup
consultation
percentage

93.9%

89.7％

95%

Female cancer
checkup consultation
percentage

55.4%

59.4％

80%

Tobaccorelateddiseases

Reduce secondary exposure to cigarette smoke
and smoking percentage

Percent of theKomatsu Group in
Japan that smokes

32.0％

29.8％

Not
more
than thenational
averageofsmokers(16.7%)

Lifestyle
improvement

Establish a system or environment that leads tothe improvement of motivation to improve or
promote the healthy lifestyles of employees(e.g. diet and exercise)

Percent of employeeswith Healthy Action
Competency*

45.7%

49.8%

50%

Percentage
responding to ourrecommendation tointerview employees
under high stress

100％

100%

100%

Percentage
responding to highstress workplaces

100％

100%

100%

Mental health

Reduce the number of individuals with mental
disorders, provide early care, appropriately
support their return to workplaces, and create ahappy and vigorous workplace(Scope of FY2020 results aggregation: All employees of the Komatsu Group in Japan)* Capability of voluntarily practicing healthy actions (lifestyle improvement/maintaining an appropriate exercise regimen and diet, etc.)

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Improvement activities in the company cafeterias
We are improving the company cafeterias at domestic plants, using the Komatsu Healthy Checklist we prepared to improve healththrough diet. In FY2020, the cafeterias at our plants in Awazu, Ibaraki, and Tochigi obtained Smart Meal certification from the Healthy
Meal and Dietary Environment Consortium. Our activity was introduced as an example of a Smart Life Project led by the Ministry of
Health, Labour and Welfare. We will continue to improve in cooperation with the cafeteria business operators while considering thesituations and the past efforts at the plants.

One of the popular Smart Meal combos (Ibaraki Plant)

Our response to the COVID-19 pandemic (e.g., support of employee health and sharing of
information)
The COVID-19 pandemic greatly impacted our working environment, including the increase of teleworking. In these circumstances, we
continue to focus on supporting health and sharing information in FY2020. For example, we began holding health-related webinars andsharing information about wellbeing. We will continue to share information with our employees to support their health beyond COVID19-related information.
Our major responses inside Japan・An intranet website about life during the COVID-19 pandemic was created.
・Health-related webinars were held
・The improvement of lifestyles using wearable devices was promoted
・Pulse oximeters were lent to employees who contracted COVID-19
・Infectious disease specialists were invited to lecture
Our major responses outside Japan・The number of nurses at subsidiaries in South America where the spread of infection was significant was increased
・Questionnaire-based surveys of our expatriate employees was conducted・Leaflets distributed to the families of our expatriate employees

Supporting Supplier's Safety Activities
For details on the safety activities for the member companies of Midori-kai, an organization made up of our business partners(suppliers), please click "Support for Member Companies of the Komatsu Midori-kai" .
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Status in FY2020

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

FY2020 PracticeBased on the rules of the Industrial Safety and Health Act,
educational training for mental health is conducted. Stresstests were started in FY2006, and stress awareness training
were started in FY2007 and is being held for the employees of
all Group companies in Japan.

Stress tests/awareness training
implemented in 14 companies, with approximately
22,789 employees“Support Letter for the Heart”, which is motivational material
for management personnel, is distributed every other month(even months) to management personnel within the Group.

Education based on Job Levels
Contents

FY2020 Practice

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

New Employees (1 time, 420 people)
3rd year of employment with the company (11 times, 343
people)7th year of employment with the company (2 times, 80 people)
Mid-career recruitment (as necessary, 53 people)
New Assistant Managers (9 times, 300 people)
Foremen/Senior Foremen (6 times, 168 people)
New Managers (6 times, 207 people)

Education based on Function
Contents

FY2019 Practice

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

Safety and health practical training for production managers (1time, 10 trainees)
Education for production engineers (1 time, 16 trainees)
ISO 45001 standards understanding training (33 trainees)
ISO 45001 internal auditor development training (205 trainees)

Number of major work-related accidents (fatal)
Komatsu group consolidated companies: 3 incidents
・August 2020: A local employee died after falling into a pit in Indonesia.
・December 2020: A local employee died after being struck by a large rolling component and falling during assembly in Brazil.
・March 2021: A local employee in Brazil died after being electrocuted while handling a welding machine.
The number of accidents at non-consolidated domestic sales companies: 1 incident
・November 2020: An employee of the sales company run by the founding family died when pinched in a machine while replacing acomponent
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The number of accidents at overseas consignees: 1 incident
・February 2021: An employee of a contractor died in China after being pinched by an automatic carrier.
We take these accidents very seriously, and will continue to actively engage in appropriate safety and health activities to ensure thatsuch accidents will not occur again.

DATA

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

Note: Partially revised as a result of revisions to past data.
1. The data for all industries (Japan) and construction and mining equipment manufacturing industry (Japan) are provided by the
Ministry of Health, Labour and Welfare.
2. The scope of the Komatsu Group (Japan) includes Komatsu Ltd. and group companies in Japan.（Excluding Komatsu Safety
Training Center, KCS and KBS)
3. The scope of the Komatsu Group (global) includes "Komatsu Group (Japan)" and overseas production plants.

Frequency of occupational accidents (occupational illness frequency rate)

1. Occupational illness frequency rate (OIFR): Number of occupational illness absences (times) / Total of working hours (hours) x
1,000,0000
2. Occupational illness: Back problems, heat illnesses, chemical poisonings, infection, etc. speci ed by the Ministry of Health, Labourand Welfare
3. Komatsu Group (Japan): Komatsu alone + group companies in Japan（Excluding Komatsu Safety Training Center, KCS and KBS)The Osaka Plant acquired ISO 45001 integrated international standards certi cation for the rst time in April 2019, and other divisionsand Group companies acquired integrated certi cation in April 2020.
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OSHMS (Occupational Safety and Health Management System) Certification and Renewal of Certification in Japan(The legends: ◇JISHA OSHMS ●ISO 45001 OSHMS Certification and Renewal)

FYOsaka Plant

~2018

2019

2020

◇

●

●

Head Office

KomatsuGroup Company●

Awazu Plant◇●

Kanazawa Plant◇●

Ibaraki Plant◇●

Oyama Plant◇●

Tochigi Plant○●

Koriyama Plant◇●

Shonan Plant◇●

Himi Plant◇●

Advanced and Fundamental Technology Center●

Field Testing Department●

Komatsu Cabtec◇●

GIGAPHOTON

◇

●

KELK

◇

●

Komatsu NTC◇●

Note: Integrated international standards certification acquired for FY2020 onward.

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Overseas OSHMS (Occupational Safety and Health Management System) Certification and Renewal of Certification8.2（The legends □：OHSAS18001 ●：ISO45001）
FY

~2018

2019

2020

Komatsu America Chattanooga Manufacturing Operation

□

●

●

Komatsu America Peoria Manufacturing Operation□

Komatsu America Newberry Manufacturing Operation●●

Komatsu Mining Wadeville●●

Komatsu UK●●

Komatsu Germany (Construction Division)□●

Komatsu Germany (Mining Division)□●

Komatsu Italia Manufacturing

●

●

●

●

Bangkok Komatsu□

PT Komatsu Indonesia□●

PT Komatsu Undercarriage Indonesia□●

Komatsu Shantui Construction Machinery Co., Ltd.

●* OHSMS: Occupational health and safety management systems* OHSAS 18001: Occupational health and safety assessment series118

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

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

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

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Policy on Production and Procurement of Components and Parts for Construction and Mining Machinery
Category

Production andprocurement policy
Permanent development
and production in Japan(supply from Japan to theworld)

Definition

Components
A

Key components for differentiation that
determine product quality and functions

Components
B

Components that we need to purchaseintensively from certified suppliers from theviewpoints of functions, quality, andinvestment

Optimal procurement from2 or 3 regions in the world

Components
C

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

Local procurement

Examples of parts
Engines, transmissions,axles, hydraulic equipment,
and electronic equipment
Floor parts of cabin, coolingparts, undercarriage parts,cylinders, high-pressure
hoses, tires, rims, andoperator's seats
Thick/ thin sheet-metalparts, machined parts, andcast and wrought products
as materials

The breakdown of procurement in monetary terms in the construction and mining equipment business of the Komatsu Group in
FY2020 is shown below.
Components Types by Percentage of Procurement in Monetary Origin of components by Percentage of Procurement in
Terms
Monetary Terms

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3. The Komatsu Midori-kai Supply Chain
In the construction and mining equipment business, Komatsu has agreements with approx. 2,700 business partners (primary suppliers)
all over the world. From amongest them, we have established the Komatsu Midori-kai which consists of particular business partners
who are deemed especially important or critical for the Komatsu Group. The members are selected through evaluation from theviewpoint of management culture including the management philosophy of top management, SLQDC* performance including
development and proposal capabilities in business transactions with Komatsu, the level of importance of the supplied items in light ofour procurement strategies and technologies, the track record and the size of business transactions with Komatsu, and otherelements. At present, the Komatsu Midori-kai operates in five regions -- Japan, China, Thailand, North America and Europe.
Procurement from members of the Komatsu Midori-kai account for approx. 77% of total procurement in monetary terms. The Komatsu
Midori-kai in each region collaborates with Komatsu's manufacturing plants in promoting activities that take advantage ofcharacteristics of the region. It also holds regular meetings to promote understanding of Komatsu's businesses and activate
communication between Komatsu's executives and top management of member companies. Many overseas member companies, aswell as those in Japan, participate in the general meeting, which is held in November every year. At this meeting, executives of Komatsugive business briefings, and explain our global procurement policy and priority activities. In Japan and China, as a measure to support
the improvement of member companies' competitiveness, the Komatsu Midori-kai divides its members into some groups(subcommittees) based on the items they supply, and promotes improvement activities in cooperation with Komatsu by selecting
common themes such as safety, the environment and cutting-edge production technology. Information about actual improvementsthat have been made is shared by companies in the same group to promote the horizontal spread of information.
* SLQDC: abbreviation for Safety, compliance with the Law, Quality, Delivery and Cost

General meeting of Midori-kai (Japan)

Inaugural ceremony of Midori-kai in Thailand

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Detail of Critical Suppliers

RegionMidori-kai
membercompanies

Nonmembers ofMidori-kai

Total

Total

Japan
China
ThailandUSAEU
sub total
Japan
USA
Indonesia
India
VietnamPhilippines
sub total

156
59
31
44
39
329
1
2
4
12
3
1
23
352

Number of companies
Proprietary parts*2
Sub-contracted*1
HighlyHighlyInvested depend
Investedondepend on
Bigbybybusiness
w/tbusinessw/tenterprise
Komatsu
Komatsu
Komatsu
Komatsu
7
86
2
7
43
2
33
1
4
14
18
1
10
1
15
1
19
6
30
10
158
4
12
116
1
1

1
11
2

2
12

14
172

1
0
4

1
13

Tradingrm,
Material

1
1
117

11
5
2
8
3
29
2
2
1
5
34

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

Classification of Critical Suppliers
Categories
1
2
3
4

All Tier 1 suppliers
Level
3
CriticalLevelsuppliers 2
Level
1

2,666

100%

Percentage ofprocurement in monetary
terms
100%

352

13%

77%

201

8%

67%

16

1%

8%

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

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

Request to Business Partners Regarding the Guidelines
In accordance with the Komatsu Code of Worldwide Business Conduct (established in 1988), all companies of the Komatsu Group haveworked together in pursuit of thorough compliance. Moreover, Komatsu has focused on corporate social responsibility (CSR) in its
business management with the aim of coexisting with society and achieving sustainable growth. As part of this effort, Komatsu has
participated in the Global Compact, a voluntary principle of action in relation to “human rights, labor, environment and prevention ofcorruption” advocated by the United Nations, since November 2008 and has also expressed its position as a global enterprise on criticalissues confronting international society faces.
Against this backdrop, ISO26000 was officially issued in November 2010 to provide international guidance on social responsibility.
Komatsu sincerely reacts to the issues set forth in ISO26000 and will exercise leadership so that social responsibility will be borne
throughout the entire value chain.
According to the Komatsu Code of Worldwide Business Conduct, we shall “seek to establish long-lasting stable relationships on thebasis of mutual trust” by considering business partners to be important partners of the Komatsu Group. The revision in April 2011
added statements that we shall encourage business partners to follow the spirit of Komatsu Code of Worldwide Business Conduct andthat the criteria for the selection of business partners shall include their compliance with rules of business society.
The CSR Procurement Guidelines contain a list of practices recommended for our business partners in line with the basic policy above,covering compliance and CSR. Companies of the Komatsu Group are kindly requested to take note of and incorporate the guidelines
into their management principles and unfailingly promote CSR. Moreover, we hope that these companies make similar requests to their
suppliers.
April 1, 2021
Masaki Nobuhara, President of Komatsu Procurement Division

Komatsu Group CSR Procurement Guidelines(Established on August 30, 2011; Revised on April 1, 2019 and on April 1, 2020)

1. Operations for Sound Management
1. Build a system or operational structure designed to meet various risks.
2. Establish legal and transparent decision-making processes concerning management.
3. Conduct appropriate accounting procedures, tax filing and settlement of accounts.
4. Place importance on communication with stakeholders (customers, shareholders, business partners, employees, etc.).
5. Ensure that top management will be notified promptly when any abnormal condition develops and that your company will be able
to promptly and accurately respond to the situation(s).
6. Fulfill accountability to society through active disclosure of corporate information.
7. Properly handle the personal information of customers, business partners and employees. Take appropriate measures for
information security to ensure that the confidential business information provided by Komatsu or by business partners will not beleaked, lost or destroyed.
8. Create an effective BCP so that, even in the event of large-scale natural disaster, infectious disease pandemic or any otheremergency, we can appropriately take initial measures to ensure the safety of employees, quickly restore business operations andfulfill our responsibility to supply customers with products.
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2. Thorough Enforcement of Compliance
1. Engage in business operations while complying with the laws and regulations, as well as the rules of the business community in the
countries and regions where we conduct business operations. In addition, make efforts to respect internationally accepted
standards.
2. Define a code of conduct, comprising company rules, under the leadership of senior management, and develop a corporate climatethat places top priority on compliance.
3. Establish a compliance regime, in accordance with the scale and characteristics of the company, that prevents the company,
executives, and employees from engaging in illegal conduct, and promptly addresses situations where issues have occurred (e.g. awhistle-blowing system).

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

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

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

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6. Fair Business Practices
1. Comply with all related laws and regulations and engage in free and fair competition and business transactions.
2. Respect intellectual properties of other parties and work to prevent infringement thereof.
3. Never accept inappropriate cash, gifts or other favors from any civil servant or stakeholder (customer or business partner) either
domestically or internationally.
4. Carry out proper foreign trade transactions (goods and technologies) while complying with the related laws and regulations.
5. Never have any relationship with antisocial forces or groups.

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

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

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

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

Categories for the division of roles for procurement departments

Meetings for the exchange of information with group companies

The development of the procurement staff who will be
responsible for CSR procurement is also an important issue. We
have compiled basic matters that purchasing departments must
not forget in promoting global procurement - in particular, thebasic philosophy and code of conduct that should be kept in mind
when working with business partners -- in the KOMATSU Way(Procurement). In addition, we have been facing significant
changes in laws and regulations of Japan and other countries on
business transactions, employment and labor, environmental
protection, export control and other matters. Responsible persons
from the procurement department are required to understandthese trends and reflect them appropriately in their daily
procurement activities. At Komatsu, we strive to inform all
employees of the trends by providing group training and eKOMATSU Way procurement
learning designed for each one of the job classes, from new
employees to managers.
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2. Partnership Declaration
The Partnership Declaration is our voluntary code of conduct and states that a large
company, or parent enterprise, shall partner and cooperate with small and medium
companies with the aim of facilitating their coexistence and coprosperity and shall, in fairdealing with the small and medium companies, enhance the added value of the supply chain
overall.
Komatsu announced the declaration in August 2020, expressing its support for the activities
implemented by the Cabinet Office, the Small and Medium Enterprise Agency and different
economic organizations.
Komatsu complies with the rules and regulations stated in the Act against Delay in Payment
of Subcontract Proceeds, Etc. to Subcontractors and in the promotional standards of the Act
on the Promotion of Subcontracting Small and Medium-sized Enterprises. Moreover,
Komatsu will continue to help its business partners to become organizationally stronger by
providing support for their efforts to enhance productivity and streamline work with the useof ICT and by providing training programs.

Logo of Partnership Declaration

Please access the following website to read the Partnership Declaration.
National Association of Small and Medium
Enterprise Promotion Organizations

3. Risk Assessment in the Supply Chain
Procurement from business partners accounts for a substantial percentage of our production costs. It reaches nearly 90% in middlesized hydraulic shovels, a typical piece of construction machinery. Therefore, for the stable continuation of our business activities, it isessential to identify and respond to risks in our supply chain at an early stage. There are a wide range of risks in the supply chain,including the management of business partners, their SLQDC status, natural disasters, international trade conflicts, and import/export
regulations. Komatsu visualizes risks through regular risk assessments that we conduct, particularly for critical suppliers, and we arecarrying out activities to reduce those risks. In FY2020, no serious violation of labor-related laws or of environment laws or regulations
was reported by critical suppliers.

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・List of risk assessments conducted regarding suppliers
Methods of supply chain risk assessment (〇: Subject of the assessment)
GeneralManagement

CSR

BCP

Check theAudit on&
Scope
Periodic
Environmental Compliance damage
Evaluation Monitoring
Two-wayabilityofon on
Risk (CR) supply in
Communication monitoringof level on CSR SAQ Management(a),includingManagement&
on case of
SLQDC(*2)
through Midori- Financial status Performance Safetysurvey acquisition of Audit
important
kai activities (*1)
process(*3) occurrence& Capability activities
EMS
of natural
certification(b)disasters
Once
Frequency of As needed Annually/
Once every 2 As needed
Annually
every 6 Annually Annually
Quarterly/Monthly
years
check
monthsCheckrisk ofplant
locationagainstflood,
heavy
rain, etc
Once
every 3years
・checkwithhazard・Monthly & ・Written ・・Written telephone/e- map
Annualby
Writtensurveymail check issued
performing survey
MLIT・Manage- survey ・Written survey ・Site visit through・Written survey data
ment・On- ・On-site audit ・Check
supply chain ・・site
documented management confirm
Management interview
theevidence systeminterview ・Site visit audit
status of
BCPagainstrisks

Method・Lecture &Q&A・Discussion
・Groupactivityof Tier 1
1 Totalsuppliers

-

〇

-

-

〇

-

-

〇(*5)

〇(*5)

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

〇

-

-

〇

〇(a)

-

〇(*5)

〇(*5)

〇Quarterly

〇(*4)

〇

〇

〇(a,b)

-

〇(*5)

〇(*5)

〇Monthly〇〇〇〇(a,b)

〇

〇(*5)

〇(*5)

2

*1: In case of listed company on stock exchange, use published financial statement as a substitute.
*2: S(Safety), L(Compliance), Q(Quality), D(Delivery), C(Cost)*3: Accounting, Human Resource Control, Purchasing, IT Security*4: Sub-contracted suppliers only
*5: only companies locating in Japan128

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To respond to natural disasters which recently have occurred frequently and become
diversified, we have begun to operate a supply chain management system in Japan linked todisaster information from the Japan Meteorological Agency. This is aimed at quickly
inspecting damage to our business partners and assessing the impact on our supply chain
after a natural disaster, such as an earthquake, tsunami, or typhoon. We have built a databaseof locations and production items with over 20,000 sites managed by 7,662 business partners,
including secondary and subsequent suppliers, thereby visualizing the risks of interruption in
product supply that can be expected to be caused by a disaster. This enables us to takefocused countermeasures promptly. In the event of a disaster, we first check the damage to Epicenter of the Northern Osaka
our suppliers at high risk which have been assessed through the system. Where necessary, we Earthquake in June 2018 and thedispatch security maintenance personnel to the companies to support their activities for the Cooperative Company Distribution Map
prompt recovery of production.
In 2019, our supply chain was greatly impacted by the flooding of rivers caused by Typhoon
Hagibis (No. 19), which damaged multiple business partners. In light of this, we linked theKomatsu supply chain management system to the hazard maps released by the Ministry ofLand, Infrastructure, Transport and Tourism to understand the potential location-related risks
faced by our business partners. We take measures for our business partners with locationrelated risks, for example, increasing our safety stock or securing alternative suppliers, inaccordance with how they handle their business continuity planning. In 2020, the COVID-19
pandemic, container shortages and other problems disrupted international logistics andsignificantly impacted our exporting and importing. We are also taking actions to addressthese emerging risks.

Disaster recovery support (lending electric generators)

Disaster recovery support(assisting the centering of working machines)

River flooding caused by Typhoon Hagibis No. 19

Hazard map and disaster-stricken business partner (in the Chikuma Riverbasin)
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4. Awareness Building Activities to Ensure the Penetration of CSR into the Supply Chain
To raise our business partners' awareness of Komatsu's CSR procurement guidelines, we are carrying out awareness building activities
around Compliance and BCP at the Komatsu Midori-kai meetings and monthly business meeting held in each office. In addition, the
CSR Report issued for Midori-kai member companies shares CSR-related "Everybody's Compliance" articles which are published for theemployees of the Komatsu Group, and information regarding the revision of related laws and regulations in Japan and other countries.
Starting from FY2020, to ensure the further penetration of CSR into the supply chain, we began an SAQ survey about CSR activities forour primary suppliers in Japan and other countries. Based on the standard survey tool released by the Global Compact Network Japan(GCNJ), in which Komatsu also participates, the survey involves the use of a form complementing the items Komatsu considers to beimportant. Business partners use the form to as a self-check of the degree to which they recognize CSR issues and the status of theiractions. In FY2020, the survey was designed to gather responses from 156 Midori-kai member companies and 77 have submitted their
responses to date. To increase survey participation, we will continue to explain the goals of the survey to the companies and provide
follow-up support to our business partners who we wish would increase their awareness of CSR issues.
In line with our corporate social responsibilities, Komatsu does not condone the use of conflict materials produced by the Democratic
Republic of Congo (DRC), or its neighbors (Angola, Republic of Burundi, Central African Republic, Republic of the Congo, Rwanda, South
Sudan, Tanzania, Uganda and Zambia). We have informed our business partners of this policy through the Komatsu Green Procurement
Guidelines. Working hand-in-hand with suppliers, we conducted a country-of-origin survey to determine the location of origin of ourmaterials and to ensure that none of them are sourced from areas of conflict. Moving forward, we will continue to take steps to enforce
strict adherence to this policy, which will serve to restrict funding for military groups situated in such areas. Any conflict materials
discovered to be within our supply chain will be immediately discontinued from use.

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

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

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

(1) Komatsu experts conducting safety patrols
Using check sheets and on-site patrols we conduct surveys to ensure compliance, particularly with laws (e.g. reports and inspections),
unsafe locations on site, and the existence of unsafe actions. If anything problematic is found, we request the submission of acountermeasure report, which describes the measures to prevent recurrence, as a follow-up. In FY2017, we reviewed the check sheetsand evaluation criteria so that we would be able to use the same standards to evaluate the activities of Midori-kai members companywide and follow-up with them to improve the level of each company every year.
To eliminate serious accidents, we regularly conduct comprehensive inspections of the safety devices installed on automated lines andmachines and the operation of these devices, forklift and crane operations, and the status of the standards established for working inhigh places, among many others.

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

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

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

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

Risk assessment training

Group performing a mutual safety patrol

Presentation by Sekigahara factory
at a Komatsu safety meeting

Changes in the results of safety activity evaluations in 2018 and 2019 (99 Midori-kai member companies, 116 offices)132

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

2. Compliance
The Komatsu Group conducts compliance and risk audits (CR audits). In 2016, we began to conduct the CR audits even for 16 business
partners in which Komatsu has made minority investments. The audit is conducted in four fields -- accounting, labor management,
procurement (the Subcontract Act) and information security. It is aimed at identifying potential risks and taking corrective measures at
an early stage. The risks are identified mainly by checking the status of compliance with relevant laws and regulations, confirming
business rules, segregation of business and decision-making authorities, inspecting relevant business documents and conducting onsite examinations. Voluntary establishment of compliance systems by business partners is essential for promoting CSR procurement.
We believe that such a system should desirably be established by 1) formulating rules (establishing codes of conduct of each company),2) building a structure for promoting CSR procurement (including the appointment of persons in charge of CSR procurement andpractical affairs), 3) introducing a whistleblowing system, and then 4) providing employees with awareness training. Under this policy,
we provided support to 99 companies, mainly custom goods suppliers belonging to the Midori-kai, for their establishment ofcompliance systems by providing practical examples at Komatsu and employee training materials, etc. As of the end of FY2020, we havecompleted support activities for 66 companies, and plan to complete them at all of the companies by the end of FY2021. The follow-up
after completion of the support activities and the inspection of the status of the activities of major business partners will involve a SAQ
survey.

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Main Findings through CR Audits (2016 to 2020):
Field

Accounting

Labor
management

Procurement(theSubcontract
Act)

Findings-Business flow, operating procedures and decision-making
authorities have yet to be set/ are insufficient.
-Physical inventory check is not conducted/ not regularly conducted.
-Rules on sale and disposal of stagnant assets and loss on forced
write-down of such assets are not clear.
-Management of corporate seals and password updates for theaccounting system are not done thoroughly.
Error in the service contracts for individual forepersons
Handling of the fraction (less than 30 min.) at working hour
management-Insufficient details provided on the order form (document set forthin Article 3)-There is a risk of delay in payment (within 60 days after receipt).
There is a risk of early deduction of the price of raw materials
purchased by a subcontractor from the subcontract proceeds to be
paid.
-Violation of the provisions prohibiting reduction of subcontract
proceeds (Reducing the amount of subcontract proceeds by theamount equivalent to that of discount commission where thepayment is made in cash)

Countermeasures
Formulation/ review of business flow/
operating procedure, provision of
instructions on physical inventory
check, and others
Switching to direct employment,
review of timecard operations, etc.

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

Support Activities for the Establishment of a Compliance System The number in () indicates the cumulative number of companies.
Achivement
2018
2019
5 32 (37)
5 32 (37)

FY
Number of companies we support
Number of companies which have completed support activities

Plan

2020
31 (68)29 (66)2021
31 (99)33 (99)Target99
99

Support is provided to 99 companies, mainly custom goods suppliers belonging to the Japanese Midori-kai

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Changes in Evaluation Level in CR Audits (from 2016 to 2020):

3. Personnel Development
We believe that the greatest support that we can provide to the Midori-kai is human resource development. Based on this belief, we
provide various job-level training programs as listed below. In 2020, it was necessary to cancel most of the face-to-face training
programs due to the COVID-19 pandemic. In their place, a remote education curriculum using an online meeting system was provided
to the Midori-kai companies to provide materials for employee training.
Among the support activities, we have particularly been committed to Management Salons and skills transfer activities in recent years.
Management Salons are aimed at developing young individuals in management positions, who have recently taken on new business
responsibilities. Through these events, Komatsu executives analyze the current strengths and weaknesses of each company andexchange views on the medium-term management visions of the companies with their counterparts to align and share management
policies and ideas. The skills transfer activities are aimed at facilitating the improvement and succession of the on-site skills of eachcompany. In these activities, we help each company build systems for promoting skills transfer and skills evaluation and develop
instructors in core skill fields by disseminating our own knowledge and skills.

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Training and Other Programs for Midori-kai Member Companies
Target job level

Management

Employees inmanagerial
positionsRepresentatives

Skilled workers

OthersProgramOutlineCommissioned
training

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

Middlemanagement
training

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

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

Managerial training

For newly appointed managers and on-site job leaders (e.g.
general managers of centers and team leaders)

Leader training (forfield managers)

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

Komatsu TechnicalInstitute

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

Productionengineer training

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

Instructor training

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

Inspection training
schoolAll Komatsu QC
competition
All Komatsu skills
competition(Advanced
Technique Contest)

Inspection skills training and classroom lectures

All Komatsu Safety
Competition

Participants are selected from among the Midori-kai members(report on Excellent Zero Accident circles’ activities).

Participants are selected from among the Midori-kai members.
Participants are selected from among the Midori-kai members.

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Major
achievements
54 trainees
have been
acceptedsince 1972.
27 people
have
participatedsince 2005.
Provided to a
total of 22
companies
since 2014
Around 40
peopleparticipate
every year.
Around 60
peopleparticipate
every year.
28 people
have enteredsince 2008.
Around 40
peopleparticipate
every year.
98 people
have
participatedsince 2015.

Around 20
companies
participate
every year.
Around 5companies
participate
every year.
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Instructor training

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An online meeting system is used to provide remote education.

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

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Changes in the number of K-MICS PAD units installed

5. BCP to Prepare for Natural Disasters
Natural disasters such as earthquakes, heavy rains and typhoons have frequently occurred in recent years. Worse, there are new clear
risks such as the COVID-19 pandemic, cyberattacks. The importance of establishing a BCP system for the supply chain is increasing.
Starting after the Great East Japan Earthquake in 2011, Komatsu has provided support by implementing measures to withstandearthquakes and water damage, etc. at the buildings and facilities of 104 companies, mainly custom goods suppliers belonging to theMidori-kai. In addition to these tangible measures, it is also necessary to strengthen intangible measures, including the establishmentof an initial response system by creating a BCP manual, etc., and a system for facilitating early restoration of business operations. Since
FY2019, we have held BCP workshops for 104 Midori-kai member companies, mainly focusing on support for the establishment of theirown initial response systems.
In the future, we will extend our support to activities to enable the system take root through simulations and other activities, somethingthat many of our business partners believe necessary for the promotion of BCP, and to proactively prepare to restore business
operations (e.g. the sharing of information, dispersion of production sites).
Issues to consider when advancing your company’s BCP(responses obtained from 87 Midori-kai companies)

Issues to consider when creating BCP
BCP workshops

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

2. Support for Those Obtaining Environmental Management
Certifications
We have requested all member companies of the Midori-kai in Japan and China to obtain certifications for environmental management systems(EMS), such as ISO14001 and Eco-Stage, and provided them with instructions and support for obtaining the certifications. In Japan, all 156
member companies have obtained the certifications, and we began to check the renewal status of the certifications in 2018. In China, 58 out of
the 59 applicable companies have already obtained the certifications, and we expect that all the companies will obtain them by the end of
FY2021. We encourage suppliers in U.S., Europe and the Midori-kai Thailand that are among our 352 level-3 critical suppliers to obtain similar
certifications, aiming to ensure that 86% of these suppliers (including all manufacturers and excluding trade companies) have been certified by
the end of FY2022.
Over ten years have already passed since the Midori-kai members in Japan obtained the certifications. Like in the case of the safety and healthactivities, it is important to follow-up the status of the certifications in each company's business activities. To realize this, we will startenvironmental audits, which we have conducted internally, mainly for the outsourcing companies of the Midori-kai from 2020. Through written
surveys on compliance with environment-related laws and regulations, etc. and on-site inspections at each company's offices, we will inspect
how EMS has taken root on site and link the results to our support for their improvement in the future.

Environmental audits
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Index

Number of Midori-kai Member Companies with EMS Certifications
Number of companies which have obtained
certification

Percentage of companies withcertification

FY2017FY2018FY2019FY2020Progress

RegionNumber of member
companies

Japan

156

156

156

156

156

100%

China

59

53

55

57

58

97%

Thailand

31

-

-

-

16

52%

North
America

44

19

19

19

19

43%

Europe

39

29

29

32

35

82%

Total

329

257

259

264

284

86%

Target100%

86%

3. Responding to Climate Change: Greenhouse Gas Reduction in the
Supply Chain
In 2012, as a solution to tight power supply/demand and the steep increase in electricity costs following the Great East Japan
Earthquake, we began to roll out activities to reduce the power consumption of 96 Midori-kai members in Japan by setting a target
reduction in electricity consumption of at least 15% compared to 2010. This target was achieved in FY2016, with an average reductionof 20%. As a result of the expansion of these activities thoroughly across all our suppliers, some suppliers have won the ECCJ Energy
Conservation Grand Prize Award. Since 2017, despite large fluctuations in the amount of production, we have worked to maintain andimprove the reduction level through independent improvements at each company. In the second half of FY2019, we also set a target of
reducing greenhouse gas emissions from all kinds of energy, including heavy oil, gas and electric power, by 15% (by the end of FY2024,
compared to 2010). As a first step, we conducted a fact-finding survey of ten casting and forging companies and heat treatmentcompanies which emit large amounts of greenhouse gases, and began to provide them with information about the improvements that
we had actually made. While providing concrete support to help these 10 companies to improve, we will also request that the 201
suppliers that fall under our Critical Suppliers-Level 2 set self-reduction targets in sequence and take tangible measures to reach thosegoals.
Changes in electric power consumption(Midori-kai 93
Change in CO2 emissions(Midori-kai 93 companies)
companies)
Independent Practitioner's Assurance
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Status of setting of targets for the reduction of GHG emissions Results of activities in Japan for reducing power consumption(156 companies in the Midori-kai)from 2012 to 2016 (reduction of electric power consumption
rate calculated against the 2010 base unit)
Already Not set/not
set
answered yet
Short-term target

98

58

Medium- and long-termtarget32

124

4. Addressing Water Risks
We are inspecting 135 offices of 96 Midori-kai members in Japan to understand their general water risks, including the abovementioned heavy rain and tsunami risks, locations, potential and actual water intake/discharge capacities, water quality, and how they
address these issues. We also use Aqueduct in these analyses.
In response to these investigations, we have been conducting activities to reduce water consumption since FY2017. In these activities,
the top ten companies in the consumption of clean water are considered to be model companies and we present Komatsu
improvement examples and provide guidance on improvement through on-site visits, with a target of 15% reduction of water
consumption by FY2021. In FY2018, the target was achieved. Since then, we have voluntarily stayed aware of the amount of water usedand have extended the activities to other Midori-kai companies through the distribution of improvement examples from Komatsu andten other companies.
Changes in clean water usage by the top 10 Midori-kai
companies

On-site investigation of water risks

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

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

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

6. Dealing with Biodiversity
In 2011, Komatsu established “the Declaration of Biodiversity by Komatsu”, a declarationthat we will work for the reduction of environmental impact through our businessactivities and for the conservation of biodiversity through our social contribution
activities. Receiving support for our policies from Midori-kai members in Japan and othercountries, we are conducting community contribution activities in cooperation withthem, such as environmental conservation. We also encourage the companies toimplement their own unique efforts in accordance with their own unique situations andgeographical locations.
Cherry tree planting activity in China (Jining,
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Support for construction and environmental conservation of the Yusen-ji copper mine in Komatsu,
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Safety and environmental initiatives at sales and service
companies
Support for Sales and Service Divisions in Developing Environmental
Management Systems
Komatsu also continues to be committed to safety and the environment in the sales activities of Komatsu Group construction
machinery. To raise awareness about environmental management, in FY2020 we supported the development of environment
management systems and improvements of our worksites. We also took other steps to provide support, such as remote education
which was introduced after the outbreak of COVID-19.
Item

FY2019CO2（kt-CO2）

FY20207.5

Year-on-year
7.6

1.8％ increase

Acquisition of ISO14001 Certification
Komatsu Customer Support Co., Ltd. (“KCSJ”), was established in April 2018 to carry out activities to acquire ISO 14001 certification, aninternational standard, as part of their efforts to establish an integrated environmental management system. With the construction
machinery, rental, and lift divisions of seven companies being consolidated, all companies, including Head Office, engaged in astandardized effort for environmental improvement and successively renewed their certification as planned.

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

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Proper Discharge of Waste
The waste management system (which centralizes the management of electronic manifests, consignment contracts, permits andothers) has been introduced in the rental and lift divisions of all KCSJ companies, which has enabled all divisions to properly manage
the system without leakage by centralizing the operation of the system and visualizing the management of emissions of waste.

Reduction of Environmental Impact in Our Regular Operations- Supporting the sale of environmentally friendly products -Along with the expansion of the lineups of eco-friendly machines developed by Komatsu,
such as machines equipped with Tier 4 Final which satisfies emission regulations, ICT
construction machines, and battery forklifts, we proactively focused on the promotion ofsales and aim to reduce environmental impact through our operations (sales and service).
Moreover, we have tentatively introduced electric power excavators (PC30E-5) since
FY2020 and have been making proposals to environmentally conscious users.

A demonstration held at an IOT center

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Environmental Risk Management
Promoting Legal Compliance, and Pollution Mitigation and Prevention
Komatsu complies with national and local laws and regulations and ensures that it periodically reports and maintains measurement
results.
In FY2020, there were two violations and one violation of environmental regulations in Japan and other countries, respectively, each ofthem minor. No fines are imposed and they have all been resolved.
There were no major environmental accidents which might pollute the environment on the boundary of our site during this period.

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

Status of Soil and Groundwater Cleanup in Japan
Business unit

Cleanup method

Cleanup status

Awazu Plant

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

In process

Komatsu Plant(former site)

Excavation and removal, groundwater
withdrawal and aeration, bioremediation

In process

Osaka Plant

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

In process

Shonan Plant

Excavation and removal, groundwater
withdrawal and aeration

In process

Tochigi Plant

Excavation and removal, bioremediation

In process*1 Bio-remediation is a purification process whereby hazardous materials are purified using micro- organisms. This return the soil to a non-hazardous
state.
* Investigative surveys revealed zero contamination in the Koriyama Plant, Technology Innovation Center in Hiratsuka, Techno Center in Izu and Field
Testing Department in Oita.
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Managing PCB (Polychlorinated Biphenyl) Waste
Komatsu stores and disposes of PCB-containing waste (such as transformers and fluorescent stabilizers) in accordance with the "Act on
Special Measures concerning Promotion of Proper Treatment of PCB Wastes" and the "Waste Management and Public Cleansing Law".
We intend to continue our appropriate treatment of PCB waste, including low-concentration PCB waste, according to our plan.

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

In FY2020, the number of PRTR* substances with a handling volume of 1 ton or more (0.5 tons or more for Class I Designated Chemical
Substances) was 25, a reduction by one, compared to the previous year.
The PRTR substances xylene, ethyl benzene and toluene account for approximately 90% of the emissions from Komatsu and KomatsuGroup production sites. Most of these emissions are released into the atmosphere.
In FY2020, the volume of xylene, ethyl benzene and toluene fell from FY2019 levels despite increased production volume due to theongoing switch to paints and thinners that contains less PRTR Class 1 substances at each site.
We will continue to make efforts to switch to paints that contains less PRTR Class 1 substances, introduce high solids thinners andpaints, improve coating efficiency, reduce coating film thickness, and recycle paint thinner. Emissions in FY2020 were reduced byabout 15% from the previous year.
* PRTR: Law designed to mandate the disclosure of the amount of specific chemical substances released into the environment to promote themanagement of such substances (The notification system based on the PRTR Law)

Breakdown of the Amount of PRTR-related Substances Released and Transferred from
Komatsu Group Manufacturing Facilities in Japan
Komatsu Group Manufacturing Facilities in Japan

Independent Practitioner's Assurance* Totals may not match exactly due to rounded decimals in individual categories.

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Amount of PRTR-related Substances Released into the atmosphere
Komatsu Group Manufacturing Facilities in Japan

Independent Practitioner's Assurance

Note: Partially revised as a result of revisions to past data.

Reducing VOC Emissions
The majority of VOC emissions are from VOCs contained in paint such as xylene and ethyl benzene.
Emissions in FY2020 were reduced by 5.9% compared to the previous year, and we have managed to maintain a 50% reduction(compared to FY2005) in the amount of VOC emissions per unit of manufacturing value.

Amount of VOC Released
Komatsu Group Manufacturing Facilities in Japan

Independent Practitioner's Assurance

Note: Partially revised as a result of revisions to past data.

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Reducing the amount of coating used by automating coating lines for large parts
In FY2019, at the Awazu Plant, large frames were coated by hand in the past. They have started coating them on an automated coating
line, which has reduced coating material consumption drastically.
Automation had been difficult because different large parts are attached for each customer, requiring the coating to be appropriate foreach shape, and also because seasonal changes in temperature made it difficult to adjust the coating conditions. To introduce the new
equipment, we performed several improvements. First, we installed a booth to pre-heat parts to adjust to the temperature changes. We
also started controlling the temperature of the coating materials. Second, we placed the robot so it would be able to always coat fromthe same direction by rotating the part being coated, etc. Those improvements enabled us to introduce the automated coating line.
In the past, humans would accidentally recoat areas, which makes the coating film thicker. The introduced robot can consistently spray
the same amount of coating, which has realized a constant coating thickness, preventing the waste of the sprayed coatings.
Consumption of coating was reduced 47% after the introduction of the robot. Moreover, the automated line also reduced the amount of
coating adhering to the walls of the coating booth, improving cleaning and maintenance as well.

Frame coating with the coating robot

Reducing the Use of Substances of Environmental Concern andComplying with the EU REACH and SCIP Regulation
Komatsu is aware of the harmful environmental impacts that certain materials possess, and has made continuous efforts from an earlystage to reduce the use of a number of such substances. These included asbestos, lead, and other such items. In FY1999, we created ourown list of banned and limited-use substances (Refer to “Substances of Environmental Concern Banned or to Be Reduced for Use in
Products”), which was based in part on Japanese legislation (Japanese Law Concerning the Examination and Regulation of
Manufacture of Chemical Substances Control) that banned a number of chemical materials as well as regulatory measures in othercountries.
We have also implemented more stringent measures in the control of substances that raise environmental concerns. In compliancewith REACH*1 and SCIP*2, we began revisions of our FY1999 listing of banned and limited-use substances. We have also collaborated
with suppliers to create a regulatory system that strengthens control of potentially harmful materials being used for production. We
have rolled this system out in Japan and Europe, with plans to continue implementation in other areas of operation.
Through the use of this system, we identify SVHC (substances of very high concern) in not only vehicles for export to the EU or produced
at local EU companies, but also in vehicles currently in production and in newly developed vehicles. Furthermore, we also regularly
check for new SVHCs to be added to the list.
There are currently 211 SVHCs registered, with the list being revised every six months. We expect this number to increase to about 1,500
in the future. We have also devised a workflow to monitor control of these substances.

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Control System for Substances of Environmental Concern

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

NumberChemical Substance
Hexavalent Chromium
PBB/PBDE/HBCDD *4

Banned17

Cadmium
Tri-substituted
Organostannic Compounds
Asbestos

PCB
Trichloroethylene
PFOS (Perfluorooctane
sulfonate)

To be reduced(Subject tolimited use)

Substances ofVery High
Concern(SVHC) under
EU REACH
Regulations

Triethanolamine
RCF (Fire-Resistant Ceramic
Fibers) (Alumina and Scilica
Types) *4
Arsenic
Specified phthalate ester(DEHP/DBP/BBP/DIBP) *3
Methanol

Lead
Alternative CFCs (HFC)
15(211)*5

Polycyclic Aromatic
Hydrocarbons (PAH)
BNST

DOTE

Mercury
Sulfur Hexafluoride *4
Specified CFCs/Alternative
CFCs (HCFC)
Hexachlorobenzene
Selenium
Specified Chlorinated Flame
Retardents (TCEP)
DZ
UV327

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

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*1
*2
*3
*4
*5

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

We are reducing and ending our use of substances of environmental concern. One of our efforts to achieve this is our plan to replacecomponents containing specific phthalate esters with alternatives by 2024.

NOx and PM Emitted from Products
To reduce the NOx (nitrogen oxide) and PM (particulate matter) contained in the exhaust gases of diesel engines, which are used inconstruction equipment and other machinery, new emission control regulations have been established, and we have been developing
products that emit cleaner exhaust gasses. About 85% of the construction machinery manufactured in FY2020 complies withregulations equal to or more stringent than U.S. Tier 3 and EU Stage IIIA regulations. As a result, the average NOx and PM emitted by theconstruction equipment products produced by Komatsu are shown below:
Average emission value of NOx and PM

Independent Practitioner's Assurance

Komatsu's Efforts Regarding Water
Due to climate change, population growth and other phenomena brought by global warming, risks of river flooding, droughts, water
shortages and other water-related problems have surfaced all over the world and are becoming more serious every year.
The Komatsu Group respects the right to water and sanitation as important rights. We also fully understands that we depend on thatwater and our business operations are influenced by and exert influence on the quantity and quality of that water.
Therefore, we engage in production activities that minimize environmental impact, provide good products and services and takeappropriate actions to mitigate water-related risks in an effort to conserve local water resources and ensure that the water stays safe. It
is our goal to promote these activities at All Komatsu and lead to the conservation of the global environment.

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

Actions Against Water-related Risks
Based on the Komatsu Earth Environment Charter, the Komatsu Group has promoted the reduction of water usage and recycling andhas carried out activities, mainly for the protection of water quality. In FY2020, we conducted a water-related risk survey at our 76 main
offices in Japan and other countries, irrespective of whether they handle production. In this survey, we conducted (1) versatile andobjective identifications of water-related risks using WRI Aqueduct, and (2) subjective awareness surveys of water-related risks that
Komatsu considers to be important. Combining these two surveys, we expanded the scope of the water-related risk survey andincreased its accuracy. The water-related risk survey showed that Komatsu Group had some areas facing risks of disasters such as
heavy rains, river flooding and tsunami (including risk awareness to the supply chain) .
Going forward, we will conduct a water-related risk survey on a regular basis to keep updated on the water-related issues of theKomatsu Group.

Water stress risk survey by area (FY2020)
Using WRI Aqueduct, we surveyed 34 main production bases of the Komatsu Group about water stress risks in the water resource usage
required for their production activities, such as clean water (tap water/city water), industrial water (clean water for industrial use), andwell water. We corrected the results from WRI Aqueduct based on unique evaluations of the specific business locations.
The business locations whose water stress risks were rated as high or middle-to-high account for 10% of our water usage. Whileapproximately 67% of the water used by Komatsu as a whole was well water, we found that all of the water used in the businesslocations with high or middle-to-high water stress risks was clean water and that water usage reduction and water recycling areimportant for securing water resources in these areas.

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

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

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

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Compliance and Risk Audit at overseas group companies
Komatsu has been conducting planned compliance and risk audits (CR audits) since fiscal 2007 for risk prevention at overseas groupcompanies.
In FY2020, we had planned to conduct audits in Europe and the United States. However, COVID-19 made it impossible to visit sites toaudit them. In Europe, we used an online meeting system to remotely audit KUK. Audits in the United States were postponed to thenext fiscal year due to time differences. Audits are performed with the support of domestic mother plants. Remote auditing does notenable us to see what is happening at the site. We used the check sheet in our fact finding about the sites, as is done in a typical audit.
In addition, we gathered many different documents about the results of water tests and the administrative procedures of local affiliates
before beginning the audit. We also conducted a paper audit and an interview-based audit. As a result of the audits, we detected no
major problems that could lead to the realization of an environmental risk. They were proactive about activities reducing
environmental impact. We continue to carry out follow-ups checks at areas where audits have already been completed, and plan to
conduct further environmental audits of our group companies in other regions.

Past Environment Audits
Year

Area

Year

Area

2007

China

2014

United States and Brazil

2008

—

2015

Thailand2009

Thailand and Indonesia

2016

India and Indonesia

2010

India

2017

Russia and China

2011

Brazil2018

Indonesia and Brazil

2012

Russia and Czech Republic

2019

China and the United States

2013

United State

2020

EuropeHolding Regional Environment Meetings
At overseas business units, employees in charge of the environment and safety in each region gathered to hold meetings. By
exchanging information of and discussing common issues in the region, they aim to improve compliance and the level of theenvironmental impact reduction activities at each business unit. Meetings in FY2020 were held in North America, Latin America, Europe,
Southeast Asia, Oceania and China. In most of these regions, meetings were held online due to COVID-19. These meetings were allattended by many participants who reported on their companies’ environmental activities. Through activities like this, we would like tofurther revitalize the environmental activities of the Komatsu Group.

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

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

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

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

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Komatsu will promulgate the importance of biodiversity to all employees and undertake activities with their full participation.
We will involve corporations related to the lifecycle of Komatsu products and representative agencies as well as customers inthese activities and promote our initiatives on a global group-wide scale.
Ⅴ(Communication)
Communication: Komatsu will strive to educate and disclose related information to employees. In addition, Komatsu will
actively disclose information on activities being undertaken and work to contribute in heightening the level of societal
awareness on the importance of biodiversity.
Ⅵ

Guidelines for Biodiversity (114KB)

10th anniversary of biodiversity
Komatsu established its Declaration of Biodiversity and Biodiversity Guideline in January 2011. For the nine years since then, we havecontinued to perform One-site, one-theme activities at each base (plant and office) globally.
2020 is a landmark year as 10 years have passed since the Conference of the Parties (COP10) was held and the Aichi targets wereselected. 2021 is a milestone as it marks the tenth anniversary of Komatsu’s Declaration of Biodiversity. Coinciding with this, we
distributed a questionnaire to the Komatsu Group and surveyed their biodiversity conservation activities to identify future subjects andpolicies to implement in the future.
The results of the survey, showing the status of each base, are below.
The management of each base recognizes and understands the biodiversity conservation activities to be an important managementtask, and all employees participate in the activities.
Because the activities also serve as environmental education for the next generation (e.g. the children of the employees and thecommunity) and are promoted in cooperation with the government and local communities, the activities have gained theunderstanding of the community and are also a source of pride for the community.
Recognizing that biodiversity conservation activities are closely associated with the establishment of a society in harmony withnature, they have set not only goals for the biodiversity conservation activities in a restricted sense but also improvement goals forCO2 and water consumption and waste reduction in our operations (throughout the life cycle) and are implementing activities toachieve them.
In the future, to expand biodiversity conservation activities to the entire life cycle, we will explain these activities to the supply chain
and motivate them to proactively participate in activities.

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1．Land use consideration

Koriyama Plant: Biotope on the premises

Hensley's Dallas facility：Bioswale

2．Community contribution

Oyama site: Tide prevention forest restoration volunteer project in Iwaki

Planting a tree in Inner Mongolia (China)

3．Ecosystem conservation

Oyama Plant: Around the Manabi-no Mori

Rare vegetation preserve on the plant’s premises (Indonesia)

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

Fauna and Flora habitat survey

Activity to remove invasive plants

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An investigative agency’s evaluation of our biodiversity conservation activities
As a result of the survey in FY2019, we confirmed diverse
Fauna and Flora inhabiting the area, including 10 newly
discovered rare species. It was a result of initiatives thathave been continually implemented, the creation of afield of silver grass, a domestic species, after the removalof invasive plants, the regeneration of a shining village
forest, and the creation of a new habitat that aims for thecreation of an ecological network. In particular, as anadvanced example of what is possible in theconstruction, mining and utility equipment field, thatthese initiatives were carried out and the results werereaped within an experimental laboratory whose land
was planned to be altered is highly commendable.
Greenfront Research Lab.

The benefits harvested from a biodiversity-based
ecosystem (for example, food supply and water
purification) are called ecosystem services. We evaluatedecosystem services at Komatsu's Test Center for the firsttime in 2011. At that time, it was quite an advanced
initiative. It is wonderful that, since then, thesebiodiversity conservation activities have continued fornearly 10 years, and have been steadily producing results.
At the Test center, ecosystem conservation activities thatsuit the local community, such as the removal ofinvasive species and the establishment of a village forest,
are being implemented.
Mitsubishi UFJ Research and Consulting Co., Ltd.

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

1. Activities for Corporate Investors and Securities Analysts
On the same day that quarterly business results are announced, the company holds explanatory sessions for corporate investors andsecurities analysts (we also release this information on our website). Overseas, we provide institutional investors, primarily those in the
U.S. and Europe, with explanations about our business performance and other information by sending representatives or holding
online meetings.

2. Informational Meeting for Individual Shareholders
To continually communicate with individual shareholders, Komatsu convenes
shareholders' meetings every year and our senior management explains the company's
performance statistics and management strategies and holds Q&A sessions. Usually, themeetings are held in major cities in Japan. To prevent the spread of COVID-19, however,the FY2020 meeting was held online for the first time. Shareholders from all around thecountry participated and many questions were raised during the Q&A session, which
covered a wide range of topics such as the impact of COVID-19, our efforts to reduce fixed
costs and the areas of business with the potential for future growth. A streaming video
and documents of the meeting are available for viewing on our website.
Since the first one in 1997, we have convened 50 shareholder meetings attended by about
17,000 shareholders in total.

FY2020 Online Shareholder Meeting

3. Plant Tours for Individual Shareholders
Komatsu holds plant tours for individual shareholders to further deepen their understanding of the company. In FY2020, plant tours
were cancelled due to the spread of COVID-19. Komatsu’s official YouTube channel shows videos delivering our corporate messages andexplaining our brands, products and technologies and also features VR (virtual reality) content of plant tours.
Videos of plant tours can be viewed on the following site.
Komatsu’s official YouTube channel

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4. Meetings for Individual Investors
Komatsu holds meetings for individual investors to explain our business andmanagement strategies as well as to cultivate a deeper understanding of our company. In
FY2020, we had four online meetings for individual investors. Streaming videos anddocuments of the meetings are available for viewing on our website.
A shot from an online meeting for individual
investors

DATA

Facts about our events for individual shareholders and investors held in FY2020:
Number of events held

Approximate number of viewers

Online meeting for shareholders:1Viewed live by a total of 267 people

Online meeting for individual investors:

4

Viewed live or on demand by a total of
7,082 people

Documents and other materials used in the meetings can be viewed on the following site.
IR site on the events for shareholders and individual investors

161

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Communication with Employees
Within Komatsu, the president convenes a “Meeting with the President” periodically at each business site in Japan. At these meetings,
the president directly explains the business environment and related issues, and also takes part in a Q&A session held for employees
and upper management. These meetings held at our headquarters in Tokyo are simultaneously streamed online over other business
units in Japan and are also translated into English for sharing among the Komatsu Group employees around the world. We are
currently proactively engaged in holding employee meetings at our overseas subsidiaries in order to provide a place for communication
to take place with local Group employees.
In addition to these measures, we launched an intranet bulletin board, entitled “Virtual Office of President,” in January 2014 to sharethe questions and answers exchanged during the meeting with the president with employees around the world. The site is updated
each week with new questions, and as of March 31, 2021, a cumulative total of 316 questions on specific topics, along with thepresident's answers, explanations and messages to employees, have been published in Japanese and English.

“Virtual Office of President” on the intranet
Employee meeting held at the head officeCommunicating with the Local Community (Efforts in Japan)
We regularly open our plants to the public and hold various events during “Plant Fairs” tocultivate an understanding of our business among local residents.
In FY2020, most plant fairs were postponed for the purpose of curbing the spread of
COVID-19. Nevertheless, Osaka Plant accepted a plant tour and gave a science class(Science Yume Kyoshitsu) which have continued since FY2013 for fifth-year elementary
schoolchildren. The plant took thorough measures to protect against COVID-19 andwelcomed 632 pupils who toured the assembly line and watched demonstrations ofconstruction machines. This was an opportunity for us to communicate the plant
workers’ jobs.

162

Elementary schoolchildren visit Osaka Plant.

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

Data

Major Environmental Achievements in the previous year.

164

Environmental Education

168

Site Data

175

Environmental Accounting

171

Scope of Environmental Data/Calculation Standards

180

Amount of CO2 Emissions by Scope3

184

Independent Practitioner's Assurance

185

Other CSR Data

186

163

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Major Environmental Achievements in the previous year.
Environmental Management
CDP evaluation-

FY2020
Goal
Climate : A
Water ：A

Public environmental reporting-

Publishing

Theme
Public rerations ofenvironmental activities
Public rerations ofenvironmental activities

Reference
year

Index

FY 2020
Achivement
Climate : A
Water : A
Published(July）

Remarks

Research & Development
Theme

Index

Referenceyear

Development of lowemission construction
machinery and industrial
vehicles(Compliance with emission
control regulations)

Reduction of CO2
emissions from products(Promotion of fuelefficiency improvement
during product operation)
Reduction of CO2
emissions fromconstruction machineryand industrial vehicles(changing to BDF biofuel)CO2emissions
reduction(unit: %)2010

FY2020 Goal
- Developmentof Tier 4
regulationcompliant
vehicles- Developmentof Stage V
regulationcompliant
vehicles- Reduction of
CO2 emissions
from use of
products(construction
machinery,miningmachines)
Goal: 15%
reduction- Use of B50compliant
mixed light oil

164

FY2020 Achievement

Remarks- Continued development- Continued development- Continued development
Achievement: 14% reduction

Goal for2030:
50%
reduction- Continued development

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme

Theme 2 :Developing People

Index

Theme 3 :Growing with Society

Referenceyear

Improvement of recycling
percentage of construction
machinery and industrial
vehiclesThorough management
and reduction of materials
with environmental
burdens in construction
machinery and industrial
vehiclesSocialContribution
Activities

Data

Index

FY2020 Goal

FY2020 Achievement

Remarks- Achieve 99%
or more in thenext developed
vehicle・Reduction of
the volume ofhazardous
substances in
the next vehicle
to be developed(Maintaining a
90% reduction
compared to1998)- Operating asystem thatmanageshazardous
substances per
part(REACH
Compliant)- Achieved in developed vehicles(for production and sales inJapan)- Maintained 90% reduction oflead usage compared to 1998
・Added new SVHC, which are
specified in REACH and managed
use statuses of SVHC. Used thesystem to record data of themodels for the EU and the models
mass-produced or developed in
the EU(Investigated substances
contained in each part)

Production
Index

Referenceyear

FY2020 Goal

FY2020 Achievement

Remarks

2010

31％ or more
reduction

33％ reduction

Goal for 2030:
50% reduction

12％ or more

13％

Goal for 2030:
50%

52％ or more
reduction
16％ or more
reduction

52％ reduction

Discharged waste volume

Improvement ofbasic unit
Percentage ofelectricity
consumed
Improvement ofbasic unit
Improvement ofbasic unit

Goal for 2030:
60% reduction
Goal for 2030:
40% reduction

Chemical release volume(VOC emissions volume)

Improvement ofbasic unit

Reforestation

Reforestation rate

Theme
CO2 emissions
Recyclable energy usage
Water input volume

2010
2010
2005

165

35％ reduction

50% reduction

60.3％ reduction(improved 1.6point
over the previous
year）

20％ or more

21％

Only facilities
in Japan
ESG Databook 2021

Theme 1 :Enhancing
Quality of LifeManagement ofEnvironmental andSocial Initiatives

Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

Logistics
Theme
Shift totransportationmeans with a low
environmental
burdenIncrease use ofdomestic vessels andJR
Decrease oftransportation
distance
Promoting use of
nearby ports forexported vehicles
Increase use ofKanazawa Port
Decrease oftransportation
distance
Export vehicles using
nearby ports
Increase in use of
Hitachinaka Port
Improvement of CO2
emissions per cargoweight (basic unit)
from transportationof products and parts
Domestictransportation
Improvement of CO2
emissions per cargoweight (basic unit)
from transportationof products and parts
Overseastransportation

Index

Modal shift
rate per
500km

Referenceyear

ー

FY2020Goal

55%

FY2020
Achievement

Remarks

58.6%

Increased 6.6% in FY2020 over theprevious year because of reasons such as
the expansion of the use of domestic
vessels in transportation from the Awazu
Plant to Kanto and Tohoku and the
expansion of the use of the JR Freight
Railway Company in transportation ofcomponents from the Oyama Plant to the
Awazu Plant.

Kanazawa
Port use
percentage
for exported
vehicles

ー

50%

38%

Hitachinaka
Port use
percentage
for exported
vehicles

ー

99%

99%

Improvement
per basic unit

2006

Improvement
per basic unit

2011

74%

92%

166

Exported vehicles significantly decreasedin the first period. In the second period,
the rapid increase of exported vehicles
resulted in insufficient lead time andproducts were shipped from the Port of
Kobe to keep deadlines.

74%

Result of the expansion of the modal shift
above and other transportation via trains
and domestic ships.

97%

Result of improvements in the modal shift
to railroad transportation in North
America.

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Procurement
Theme

Index

Referenceyear

FY2020 Goal

FY2020 Achievement
Continued to expand
to all 93 member
companies

Remarks

Horizontal expansion of Komatsu's
activities to cut electricity consumption
by halfーー

Implementation of environmental
regulations audit

ーー

Activities to reduce water consumption(10 companies)ーー

Expand to 93 Midorikai member
companies
Implementing at fourMidori-kai member
companies
Reduce clean water
use 15% or more

Referenceyear

FY2020Goal

FY2020
Achievement

Remarks

Implemented at 4
member companies
17% reduction

Sales & Services
Theme
Implementationof measures toprevent oilleakage
Introduction ofwaste
management
systems
Provision ofenvironmental
education

Sales expansionofenvironmental
products

Promotion ofsmart
construction
work

Index
ー

ー
Number of bases
where on-site
instruction
workshops were
held
-Sales expansion
activities for Tier4
models-Sales expansion
activities for FE

Visitors to IoTCenterーAll bases

All basesーAllcompanies(7
companies)

Implemented
at 7 companies

ー75 bases

22% Reduction

ー-Salesexpansion
based onthe sales
plan-Salesexpansion
based onthe salesplan- 75% of thesales plan
- 75% of thesales plan

6,000

1,628(including
online seminar
participants)ー

167

Installation of sandbags, drainage
route diagrams, and emergency
contact networks

Due to COVID-19, we could notprovide guidance at the sites, so
we conducted inspections andprovided guidance remotely.

Due to COVID-19, it was notpossible for participants to gather
in person. Online seminars were
held in the second period toadvertise construction.
ESG Databook 2021

Theme 1 :Enhancing
Quality of LifeManagement ofEnvironmental andSocial Initiatives

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Environmental Education
Komatsu is committed to employee education with regards to good environmental practices. Under our basic framework, provision of
education is divided according to two unique categories according to type; Dissemination of common knowledge falls under theoversight of the Head Office, whereas specific vocational training is managed by respective divisions.
In FY2020, our educational activities were focused on the online programs for training internal auditors on the environment and safety.
Environmental education for new managerial-level employees, which was begun in FY2014, is currently being provided online.
Despite the fact that we already meet the legislatively mandated quota of personnel with environment-related certification, we intend
to implement further training in order to increase this number.

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

Head OfficeNo.

Course name

Target1

Newly appointed manager training

2

Participants
FY2017FY2018FY2019FY2020Komatsu Group newly
appointed managers

161

171

155

207

Training new employees

New Employees(Komatsu and affiliates)

329

369

383

318

3

Advanced environmental education(held every two years)

Environmental specialists(Komatsu and affiliates)

-

-

19

-

4

Overview of the ISO14000 series

Managers(Komatsu, affiliates, andbusiness associates)

73

36

46

98

5

ISO14001 Standard Amendment(2015 Revision)

Stakeholders regarding
ISO14001 amandment

-

-

-

-

6

Training of internal auditors /Refresher courses

Environmental auditors(Komatsu, affiliates, andbusiness associates)

89

336

87

80

7

Explanation of environmental laws
and risksManagers and employees

-

250

-

-

Development and manufacturing(introductory)

Development andmanufacturing staff(for second-year
employees)

249

187

190

208

8

168

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Theme 1 :Enhancing
Quality of LifeManagement ofEnvironmental andSocial Initiatives

No.

Theme 2 :Developing People

Course name

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Participants

Target9

Environmental training for
manufacturing engineers

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

10

Lectures on the environment,
experience-oriented education

Komatsu Group employees

FY2017FY2018FY2019FY2020

226

227

145

80

1,796

627

1,267

626

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

Course name

Target1

Education in the basics of auditing

2

Participants
FY2017FY2018FY2019FY2020Managers and employees

90

169

196

62

Overview of the ISO14000 series

Managers and employees

559

502

565

246

3

Training of internal auditors

Environmental auditors

61

34

26

21

4

Training new employees

New Employees

1,866

1,759

1,205

1,084

5

Regulatory education and personnel
exchange

Employees (and otherparticipants)

835

510

15

49

Specialist training

Environmental
conservation practitioners(persons involved inregulatory affairs, etc.)

328

464

429

230

6

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

169

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Number of Persons Having Environment-related Certificate

Independent Practitioner's Assurance

Komatsu and Komatsu Group manufacturing facilities in Japan(including Head office, Technology Innovation Center, Field Testing Department)

Certificate name

Number of persons with certificate*
FY2017FY2018FY2019FY2020Pollution control administrators

220（35）219（35）222（35）225（35）

Energy administrators

39（9）

41（9）

38（9）

37（9）

Environmental management systemassociate auditors

2

5

4

5

* Figures in parentheses indicate the number of officers required.

170

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Theme 1 :Enhancing
Quality of LifeManagement ofEnvironmental andSocial Initiatives

Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

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

Environmental Costs (Investments and expenses)

Independent Practitioner's Assurance

Komatsu and Komatsu Group manufacturing facilities in Japan (except group companies in the facilities),
Field Testing Department and Manda area

Category
1. Business area cost

(1).
Pollution
prevention
cost

FY2019Investment*1(millions of
yen)

1,163

235

Investment
FY2020Investment*1(millions of
yen)

1,720

(3).
Resource
circulation
cost

893

34

Expenses*1(millions of
yen)

2,303

Expenses*1(millions of
yen)

2,238

412

Investment for
installation andconversion ofpollution
mitigation /prevention
facilities

370

447

1,139

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

1,116

1,064

169

Investment for
reducing thevolume of wastematerials

817

727

Breakdown(2).
Globalenvironmental
conservation
cost

Contents

FY2019

Expenses
FY2020171

Contents

Cost ofmaintaining
equipment for
mitigation /prevention of air
and water
pollution and fornoise andvibration
prevention(labor anddepreciation
costs)
Cost ofmaintaining
energyconservation
facilities, such ascogeneration
systems(labor anddepreciation
costs)
Waste material
processing cost
ESG Databook 2021

Theme 1 :Enhancing
Quality of LifeManagement ofEnvironmental andSocial Initiatives

Category

2. Upstream/
downstream cost

3. Administration cost

Theme 2 :Developing People

FY2019Investment*1(millions of
yen)

0

1

Theme 3 :Growing with Society

Data

Investment
FY2020Investment*1(millions ofyen)

0Contents

Additional
investment
needed toprovide ecofriendly productservices

SocialContribution
Activities

FY2019

Expenses*1(millions of
yen)

363

Index

Expenses
FY2020

Expenses*1(millions of
yen)

359

22

Investment for
beautifying
manufacturing
sites

924

1,153

Investment inresearch
facilities for
reduction ofenvironmental
impact17,80419,012

4. R&D cost

534

318

5. Social activity cost

0

0

48

22

6. Environmental
remediation cost

0

0

145

493

Total
1,698
2,060
※1 All figures are rounded off to the nearest million yen.

21,587

23,278172

Contents

Reduction of theenvironmental
impact of massproduction units
Cost ofmaintaining
environmental
management
systems(including labor
cost)
Cost of creating
green spaces andbeautifying
manufacturing
sites
Cost of R&D
activities toreduce theenvironmental
impact ofproducts
Cost of R&D
activities todevelopenvironmentallyfriendly
construction
equipment
Cost ofconducting
surveys andremedialcountermeasuresrelated to soil
and groundwatercontamination

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

Environmental Effects

SocialContribution
Activities

Index

Independent Practitioner's Assurance

Environmental impact reduction effects

Komatsu and Komatsu Group manufacturing facilities in Japan

Items of environmental impact
CO2 emissions
Water consumption
Waste materials generation

Reduction amount (t/year)-8,153-268,555-1,388Rate of year-on-year changes (%)

-4
-10
-9

Economic benefits
Komatsu and Komatsu Group manufacturing facilities in Japan (except group companies in the facilities),
Field Testing Department and Manda area

Type
Energyconservation
Resource
conservation
Waste materials
reduction
Gain on sale ofvaluables
Other
Total

Tangible benefits
Monetaryvalue*1
Major activities(millions ofyen)of energy-saving
165 Installation
facilities
heating and cooling
53 Savingcost by biomass utilisation
Control the amount of waste
and promotion of
66 generated
recycling throughthoroughgoing sortingof scrap, used paper,
229 Salewaste oil, etc.
0512

Avoidance benefits ofenvironmental risks*2

Contribution to profits*2* In FY2020, there were no major
accidents or legal infractions
that would contaminate theenvironment.
* No litigation costs wererequired in Japan during
FY2020.

Proceeds from mobile
recycling equipment
Proceeds from value added
due to reduced
environmental impact of
products*1 Figures are rounded off to the nearest million yen.
*2 Komatsu used statements instead of numeral figures to describe the "Avoidance benefits of environmental risks" and the "Contribution to profits". We
will give further consideration to the interpretation and the understanding of efficiency.

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Effects on Society *1
Environmental impact reduction effects
Environmental impact reduction resulting from on-site
recycling methods
Environmental impact reduction resulting from productoperation
Waste components reduction resulting from "Reman"business

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

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

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

Japan
Item

Environmental impact

Energy consumption

Total CO2 emissions
NOx total amountSOx total amount
Total emissions of waste
Amount recycled
Recycling rate
BOD emissions
COD emissions
Wastewater
Output of in-house power generation
Item
Purchased electricity
Heavy oil A
Kerosene
Light oil
City gas
LPG
Gasoline
Wood chips
Total

Actual consumption
311,484 MWh
4,319 kℓ
2,682 kℓ
3,510 kℓ
4,443 km3
3,763 t123 kℓ6,143 t175

Actual value
178,524 t-CO2
103,452 Kg
5,016 Kg
13,416 t
13,353 t
99.8 %
4,230 Kg
6,968 Kg
2,184 km3
20,160 MWh
Converted to calorie equivalents (GJ)
2,954,116
167,999
97,868
133,517
183,097
188,356
4,100
75,5593,804,613

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Water consumption

Theme 2 :Developing People

GroundwaterIndustrial water
Supply water
Total

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

2,129 km3
3 km3
215 km3
2,347 km3

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

Independent Practitioner's Assurance

The Americas

Energy consumption

Item
Purchased electricity
Light oil,Gasoline, et al.
Gas
LPG
District heating
Steam
Total energy consumption
CO2
Private Power generation

Water consumption
Total emissions of waste

176

Actual value
121,397 MWh
615 kℓ12,310 km3203 t
1,683,865 GJ
51,047 t-CO2
116 MWh
253,793 t
29,655 t

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Item
Purchased electricity
Light oil,Gasoline, et al.
Gas
LPG
District heating
Steam
Total energy consumption
CO2
Private Power generation

Actual value
23,508 MWh
138 kℓ4,142 km3
3 t
10,000 MWh
413,533 GJ
12,408 t-CO2
23 MWh53,655 t
7,338 tWater consumption
Total emissions of waste

Independent Practitioner's Assurance

Asia

Energy consumption

Index

Independent Practitioner's Assurance

EuropeEnergy consumption

Data

Item
Purchased electricity
Light oil,Gasoline, et al.
Gas
LPG
District heating
Steam
Total energy consumption
CO2
Private Power generation

Water consumption
Total emissions of waste

Actual value
169,894 MWh
606 kℓ
5,664 km3625 t
6,057 t1,911,109 GJ
139,859 t-CO2
4,450 MWh576,650 t
23,765 t*1）Total emissions of waste are expressed as a composite of the amount recycled and the amount disposed.
*2）Output of in-house power generation includes electricity sold.

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Independent Practitioner's Assurance

Scope-2 CO2 emissions (Total of production sites)
Standard

CO2(kt）
Location-based
Market-based

330
294

Japan
Site Data (Japan) (15.8MB)
Awazu Plant
Osaka Plant
Oyama Plant
Koriyama Plant
Himi Plant
Komatsu NTC Ltd.

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

Overseas
Site Data (Overseas) (990KB)
The Americas
Asia

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

FY2020 Komatsu Customer Support Japan Ltd. Environmental Performance Data
Company Name
Location
Activities
Number of bases
Number of employees
Data of ISO14001 certificationacquisition

Komatsu Customer Support Japan Ltd.
Shirokane, Minato-ku, Tokyo
Sale, service and rental of construction equipment and forklift trucks
238
4,708
May 2018

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Theme 1 :Enhancing
Quality of Life

Environmental impact

Theme 2 :Developing People

Theme 3 :Growing with Society

Item
Total CO2 emissions
Total emissions ofwaste
Amount recycled
Recycling rate

12,676 ｔ
10,381 ｔ
81.9 %
Actualconsumption
14,147 MWｈ
82 kℓ
399 kℓ104 kℓ12 kℓ
20 t
57 km3

Electricity
Heavy oil A
Kerosene
Light oil
Gasoline
LPG
City gas
Total

Site Data（Non-manufacturing Divisions）
Manufacturing facility
included
Environmental Impact

Energy consumption

Index

Actual value
7,582 ｔ-CO2

Item

Energy consumption

SocialContribution
Activities

Data

Converted to calorie equivalents(GJ)
134,173
3,170
14,553
3,969
388
977
2,355
159,585

Independent Practitioner's Assurance

Site Data of Non-manufacturing Divisions
Head Office, Field Testing Department, Techno Center, General Education Center, Shinomiya Building
T, Recreaion Facilities（5 sites）
Item
Actual value
Total CO2 emissions
3,192 t-CO2
Item
Actual consumption
Converted to calorie equivalents (GJ)
Purchased electricity
4,007 MWh
38,001
Heavy oil A
89 kℓ
3,471
Kerosene
0 kℓ
9Light oil
441 kℓ16,783
City gas
7 km3
306
LPG
40 t
1,996
Gasoline
3 kℓ
87
Total
60,653179

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Scope of Environmental Data/Calculation Standards
Komatsu Group Manufacturing Facilities in Japan
Komatsu Group manufacturing facilities in Japan, with a focus on the following 11 plants
Awazu Plant, Kanazawa Plant [including Kanazawa-Daiichi Plant and Kanazawa-Daini Plant], Osaka Plant [including Rokko Plant],
Ibaraki Plant, Oyama Plant [including Komatsu Cummins Engine Co., Ltd., Industrial Power Alliance Ltd. and GIGAPHOTON, Inc.],
Koriyama Plant, Shonan Plant [including KELK Ltd.], Tochigi Plant, and Himi Plant, Komatsu Cabtec Co., Ltd., and Komatsu NTC Ltd.
Logistics offices in Japan: the following 15 plants and centers
Awazu Plant, Osaka Plant, Rokko Plant, Ibaraki Plant, Tochigi Plant, Kanazawa Plant, Shonan Plant, Oyama Plant, Koriyama Plant, Himi
Plant, Komatsu Logistics Corp. Parts Division (Kanto Hokyu Center, Kansai Hokyu Center, Awazu Hokyu Center, Hokkaido Hokyu Center
and Kyushu Hokyu Center)

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

Overseas logistics offices: the following 11 companies
Komatsu Americas Corp. [Chattanooga][Peoria], Komatsu do Brasil Ltda., Komatsu UK Ltd., Komatsu Germany GmbH [Düsseldorf],
Komatsu Shantui Construction Machinery Co., Ltd., Komatsu (Changzhou) Construction Machinery Co., Ltd., Komatsu (Shandong)
Construction Machinery Co., Ltd., PT Komatsu Indonesia, Bangkok Komatsu Co., Ltd. and Komatsu India Pvt. Ltd
Komatsu Group manufacturing facilities, both in Japan and overseas: Pertaining to all 32 of the offices mentioned above, including
11 domestic and 21 international offices.

Guidelines“Environmental Report Guidelines 2018” (Ministry of the Environment of Japan)
Basic Guidelines on Accounting for Greenhouse Gas Emissions Throughout the Supply Chain Ver 2.3(Ministry of the Environment and Ministry of the Economy, Trade and Industry of Japan)
Database on Emissions Intensities for Calculating Greenhouse Gas Emissions, etc. through a Supply Chain Ver. 3.1 (Ministry of theEnvironment and Ministry of the Economy, Trade and Industry of Japan)180

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GRI Standards
See the GRI content index

GRI Standards INDEXPeriod Covered
Primarily, this report covers data acquired from April 2020 to the end of March 2021, with a portion of information that involves dataacquired after April 2021.

Calculation base of typical environmental data
Classification
GHG Energy

Item
EnergyGHG

Energy, CO2 emission
in basic unit
Location-based Scope
2

Market-based Scope 2
Scope3

C1
C2

Calculation Method
Energy = (fuel, electric energy, etc.) x energy conversion factor
Fuels (other than biomass), conversion coefficient of electric power: standard
heating value of the Agency for Natural Resources and Energy (2013 value revisedin August 2018)
Biomass fuel: National Woodchips Industry Association (Japan)
Regional heat: site reported value (1.54 GJ / MWh)
Energy originated CO2 = (fuel quantity, electricity quantity) x CO2 emission factor
Non-energy originated GHG = Gas emissions x Global warming potential (GWP)
CO2emission factor
Electricity: 2010 value of IEA CO2 EMISSIONS FROM FUEL COMBUSTION 2012
Fuel: Japan,Overseas;Ministry of the Environment, Ministry of Economy, Tradeand Industry, Greenhouse gas emissions calculation and report manual
GWP: Value of greenhouse gas emissions calculation, reporting and publication
systemBasic unit for each plant = (energy, CO2) / (Internal manufacturing value), index is avalue with base year 100.
Base year: 2010
CO2 emission = purchased electricity quantity x CO2 emission factor
CO2 emission factor:
Japan; Ministry of the Environment, Ministry of Economy, Trade and Industry
Emission Factor by Electric Utility Substitution Value
Overseas; 2010 value of IEA CO2 EMISSIONS FROM FUEL COMBUSTION 2012
CO2 emission = purchased electricity quantity x CO2 emission factor
CO2 emission factor:
Japan;Emission Factor by Electric Power Company
Overseas; 2010 value of IEA CO2 EMISSIONS FROM FUEL COMBUSTION 2012
However, the electricity generated from renewable energy source has zero
emission factors
Purchased product service: Product weight x emission factor + cooperatingcompany CO2 emission amounts
Capital goods: capital investment amount x emission factor
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Classi cation

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Item
C3
C4
C5
C6
C7
C9
C11
C12

ExhaustDrainage

Sox Emissions
NOx Emissions
BOD Emissions
COD Emissions
Amount of water used

Water

Waste

PRTR materials

Intensity of water use
Amount of waste
Waste intensity
Amount of thesematerials emitted or
moved

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Calculation Method
Fuels and energy related activities not included in Scope 1 and 2: fuel quantity
purchased x emission factor on the upstream side + purchased electric energy
amount x upstream side emission factor
Transportation, Delivery (upstream): Fuel consumption (amount) x Emission factor(coefficient according to Komatsu actual result survey)
Waste from project: Waste volume x Emission factor (coefficient according to
Komatsu performance survey)
Business trip: travel expenses x emission factor
Employer commuting: commuting expenses x emission factor
Downstream transport: transport volume x emission factor
Use of products sold: Σ (Production volume per product model x Fuel consumption
x Product life)
Disposal of products sold: Product weight x Emission factor
Emission factor
Power of C1/C2/C3, C6/C7/C12: Emission basic unit database (Ver 3.1) for
calculating greenhouse gas emissions of organizations through the supply chain of
the Ministry of the Environment
C3 Fuel: Carbon Footprint Communication Program Basic Database (Ver 1.01)
C9: Ministry of Economy, Trade and Industry ・ Ministry of Land, Infrastructure,
Transport and Tourism Guidelines for Estimating CO2 Emissions in the Logistics
Field
Total for heavy oil, kerosene, light oil and coke:Calculated from fuel quantity x sulfur content in fuelTotal for heavy oil, kerosene, light oil, city gas, and LPG:
Calculated from Exhaust gas quantity x NOx concentration
Calculated from Wastewater x BOD Average Concentration Measurement Value
Calculated from Wastewater x COD average concentration measured value
Total amount of water intake, including clean water, industrial water andgroundwater
Intensity at a plant = (amount of water used) / (internal manufacturing value); thebase year of the index is 100.
Base year: 2010
Total amount of waste excluding valuables
value); the base year of the index is 100.
Base year: 2010
Multiply the number of secondary materials used by the content of specified
chemical substances and the rate of emissions and movement in accordance with
the Act on Confirmation, etc. of Release Amounts of Specific Chemical Substancesin the Environment and Promotion of Improvements to the Management Thereof(PRTR Act).

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

1. Main data coverage

Data coverage rate at production sites: 97%

2. ISO 14001 certification acquisition coverage

ISO 14001 certification acquisition coverage rate at production sites: 95% (If KMC is not included : 100%)183

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

Rate (%)

Summary Data kt-CO2

Scope3 (11)Customer Use

87.4

18,996

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

10.6
0.6
0.5
0.1
0.0
0.2
0.2
0.0
0.3
0.0
0.1
0.0
0.0

2,297
126
114
30
10
39
48
0
55
0
13
0
0

Total CO2Emission Amount (kt-CO2/year)

100.0

21,729Note: When the figures in each category are rounded or truncated .
The amount may not coincide with the aggregate of the relevant figures.
Category 8 is included in Scope1,2, when it's evaluated.
Category 13 is included in Category 11, when it's evaluated.
Categories 14 and 15 have no activities subject to evaluation.

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

Independent Assurance Report (PDF：236KB）

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

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Other CSR Data
Political Contributions
Our political contributions in FY2020 totalled 8 million yen.** Described in the Income and Expenditure Reports on Political Funds released on November 27, 2020 (on the website of the Ministry ofInternal Affairs and Communications)
We have confirmed that this contribution does not conflict with the provisions of Komatsu's Code of Conduct, including the provisions
regarding honest and fair business activities and honest and appropriate business operations.

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Social Contribution Activities

Accomplishments and Approaches for Social Contribution Activities

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Komatsu's Initiatives for the Social Issues

191

Developing People Needed by the Community

193

Collaboration with Cummins Inc.

194

Disaster Relief

196

Clearing Anti-Personnel Landmines and Community Development Support

199

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

203

Promoting Sports̶The Komatsu Women's Judo Club204

An employee-participatory social contribution program "One World One Komatsu"

205

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Accomplishments and Approaches for Social Contribution
Activities
Komatsu defines CSR activities as the things we do to meet society’s needs through our core business, and it has identified its material
issues through the discussion of initiatives that are able to provide value to both society and Komatsu, as below. We engage in CSR
activities based on the ideas derived from these discussions.
The guiding principle is that a company should assume its responsibility to conduct CSR activities in the regions it operates within. We
focus on the themes that enable us to leverage our expertise in our core business.

Komatsu's CSR Priorities (Material issues)
Products, Services,
and Customers

Products that enhance safety
Responsible marketing and customer support

Environment

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

Employees

Human resource development
Safety and healthRespecting employees

Human Rights

Respecting human rights
Equal employment

Ethics and Governance

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

Local Community

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

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Basic Approaches to Social Contribution (from “Komatsu’s Worldwide
Code of Business Conduct”)
CSR (Corporate Social Responsibility) is a multi-faceted topic, of which specific elements pertaining to the different aspects of its
implementation are subject to change according to country, region, or business practices. However, regardless of these variations, theunderlying axioms that drive these initiatives remain the same: companies must co-exist in harmony with society, responding to
expectations and building a relationship of mutual trust. As mentioned in other sections of this report, one of the principles that guides
the Komatsu Group on a global scale is the understanding that Komatsu should fulfill its corporate social responsibilities throughintegration of CSR into our business operations. We further build on that belief by defining clear requirements for good corporate
citizenship: a company should live up to societal expectations by promoting harmony and making real contributions for the benefit of
the community in which it operates. Komatsu is proud to report that we live up to these high standards, and are proactively engaged insocial contributory activities across multiple regions.

Governance regarding donations
Whenever we start a new project, we evaluate its ability to benefit both Komatsu’s business operations and its stakeholders. In our
implementation of our CSR activities (including donations), we introduced a check sheet in FY2013 to be used by the Sustainability
Promotion Division, functioning as an administrative office, to quantitatively evaluate the effects of the activities from both aspects,
and involved officers review this evaluation to ensure the effective monitoring of our CSR activities.

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

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

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

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Social Contribution Expenditures of the Komatsu GroupWe have divided and summarized the results of our social contributions into 6 general categories. These can be found in the infographic
below:

Type of Social Contribution Expenditure(Millions of yen)

Cash contributions

582

Time contributions

142

In-kind giving

172

Management overheads

732

Total

1,628

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

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

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

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

2020: Producing and Donating Medical Supplies in Collaboration with Business Partners
In Japan, as the number of people infected by COVID-19 increases, the shortages of medical devices became the critical issue. Though
we do not have the equipment or skills to produce medical devices, Komatsu has some assets, like long-time collaborative
relationships with our business partners and our production and sales networks. By utilizing these assets, we have procured anddonated isolation gowns and face shields, which are personal protective equipment (PPE) for medical workers for which there isparticularly urgent need.
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To procure them, we asked a Midori-kai member company to begin PPE production. At Komatsu, the staff of our production technology
also participated in the activity to improve the strength of the parts, productivity, and the comfort of the PPE during the prototyping
phase of the face shield.
After medical experts inspected the protective ability and comfort of the prototypes, 10,100 gowns and 8,000 face shields were
produced. We distributed them to medical institutions around the nation for free through the NPO, Peace Winds Japan, and thegovernment, utilizing donations from our employees.

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

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

Activities

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

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

India

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

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

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

Komatsu and its business partner Cummins collaborate to globally organize the Technical Education for Communities (TEC) vocational
training program. The program has also endured difficulties and economic hardships as it struggles to hold group classes during the
COVID-19 pandemic.
In FY2020, we donated money to Chilean educational institutions for the purchase of virtual reality educational materials and Komatsu
and Cummins also donated scholarship money to Peru.
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Developing People Needed by the Community
When we asked ourselves:"What sort of social contribution activities would meet the needs of regional communities and make the bestuse of Komatsu's strengths?" We arrived at the answer: "developing people." We are working in cooperation with several entities suchas national and local governments as well as schools, to carry out human resource development programs that are tailored to eachregion's needs and enable participants to acquire skills that will open up various employment opportunities.

Various Areas and Forms of Support

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

Support for Developing Human Resources

Dispatching instructors

Providing educational
materials and equipment

Providing facilities andsupporting operations

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Accepting apprentices

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Collaboration with Cummins Inc.
We believe that collaborative CSR activities deliver more effective outcomes than those conducted alone, by sharing the people, knowhow, and other resources of each company. In promoting social contribution activities in the past, Komatsu has collaborated withentities such as non-profit organizations that have their own unique know-how. In 2016, we agreed with our business partner, Cummins
Inc. in the U.S., to collaborate in the field of local human resource development.

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

Cummins Inc.

Established

1919

Headquarters

Columbus, Indiana, U.S.

Business segments

Engine, Power systems, Components, Distribution

URL

http://www.cummins.com/

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

TEC entrance ceremony in South Africa

With the spread of the COVID-19 pandemic worldwide, TEC is also facing various issues such as the financial difficulties of students andthe difficulty of group training. To address these issues, Komatsu is working on providing virtual reality teaching materials andscholarships.

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

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

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

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Support for Reconstruction in Areas Affected by Natural Disasters inJapan
Providing relief to areas stricken by heavy rains in July 2020

In July 2020, heavy rains severely damaged the municipalities near the Kuma River running through Kumamoto prefecture.
The municipal governments requested support, and through Komatsu Customer Support Japan Ltd., we lent three municipalities,
Yatsushiro-shi, Ashikita-machi and Kuma-mura, 15 construction machines with a value of 20 million yen which were needed in theseareas from August 2020 to the end of March 2021. The rental was free of charge.
The rented vehicles were used in recovery efforts including the clearing disaster waste from houses and stores, the moving of earth andsand displaced by the disaster and the clearing driftwood.

Clearing driftwood in Ashikita Town

Supporting Areas Stricken by Typhoon No. 19 in 2019: Donating a used
PC30MR to OPENJAPANFY2019: Cooperation with pro bono workers*helping the areas damaged by Typhoon No.19*Pro bono: Initiatives and organizations to apply specialized job experiences and knowledge in volunteer activities.
In Japan, Komatsu has mainly assisted in areas affected by earthquakes. For wind and flood damage, which have increased in recent
years, the damage is concentrated in limited areas or villages in many cases, and thus, we could not provide assistance in a moredetailed manner in some cases.
During Typhoon Hagibis that crossed Japan in October of 2019, many rivers flooded and there were successive mudslides in several
places in Japan. More than 90 thousand houses were affected around the nation.
Komatsu provided 10 million yen in support, including supplying equipment and materials.

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Washed-out rivers were surveyed with drones for free in cooperation with local governments
By request from the local government, we used drones to survey the washed-out areas of the Iruma River in Saitama prefecture for free.
Drone surveys enable the survey to approach dangerous affected sites to understand their situation quickly, which also leads to prompt
restoration work.

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

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Theme 1 :Enhancing
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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Clearing Anti-Personnel Landmines andCommunity Development Support

In the areas afflicted by anti-personnel landmines, Komatsu engages in activities to support community development throughout theprocess from demining to reconstruction. For that purpose, Komatsu partnered with the authorized NPO Japan Mine Action Service(JMAS) in 2008 and the two parties continue to work together in Cambodia and Laos. Komatsu’s demining machines and construction
equipment, developed by combining our technical expertise and knowledge in manufacturing, are working very well in these places.
Our target is to transform landmine infested lands to safe lands, and further on to lands with value by constructing roads and facilities.
Going forward, we will continue to provide support through construction equipment, Komatsu's main line of business, in pursuit ofcontribution to the independent reconstruction of the entire regions.

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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Cambodian Agriculture CSR Project

In a new initiative that began in 2019, we have introduced agricultural construction equipment to the demined sites with an aim toreconstruct farmland and stimulate the local industry. Agriculture is one of the main industries in Cambodia, accounting for approx.
25% of GDP, and rice is actively cultivated all over the country. The land exposed by a demining machine is fertile and suitable forgrowing crops. In cooperation with JMAS and the provincial government, Komatsu is helping the local farmers to improve their work
efficiency and increase yields. We use bulldozers, wheel loaders and hydraulic excavators to verify the effectiveness of farm operations.

Reconstructing agricultural lands after demining

DATA

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

Result (Cumulative Total by FY2020)

Demined area
Total removal countRoad construction / maintenance
Schools constructed
Ponds constructed

2,611ha
2,482bombs
92km
9 (which holds about 700 school children)
47

Leveling farmland

13ha

Unexploded bomb disposal activities in Laos
We started support of unexploded bomb disposal activities in 2016 in Laos.
In Laos, more than 30% of the land is riddled with unexploded bombs, many of which are cluster sub-munitions.
This is a problem on a massive scale, with children and farmers suffering bomb-related injuries on a yearly basis.
Komatsu plays its part by offering the necessary machine to UXO-LAO (a Lao unexploded bomb disposal squad) and the Japan Mine
Action Service (JMAS) free of charge, alongside engineering support for the machines it provides.
Following the success of the demining machine for anti-personnel landmines we have used Komatsu's past experiences and techniques
to develop removal machines for processing unexploded ordnance based on hydraulic excavator PC130-8, and continue the disposal
activities.
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Theme 1 :Enhancing
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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

DATA

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

Result (Cumulative Total by FY2020)

Demined area
Total removal count
Schools constructed

445ha
5,007bombs
1 (which holds about 70 school children)

Komatsu's Demining Machine

Commemoration of the first elementary school

Visiting lectures
As part of the "Visiting Lecture" initiative, Komatsu employees visit schools in Japan to lecture about the activities of the demining
project. The lectures are attended by differently aged students ranging from elementary to university levels. Up to the present, we havegiven a total of 78 lectures (including lectures held online) attended by about 6,800 students.
The feedback we received from some first-year high school students included, “Removing mines can make people feel secure. This isreally a necessary thing to do now. They said they communicate with the local people in English, which motivates me to concentrate
more on studying English. The creation of farmland makes it possible to grow crops. Building an elementary school creates a better
environment for children to study. These benefits can save developing countries. The things I learned from the lectures will help me todecide what to do after I graduate.”

Scene of a visiting lecture at a junior high school201

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Application to attend a visiting lecture
Download the Komatsu Visiting Lecture/Online Class application form

Read the following before applying:

Please note that lectures may be postponed or cancelled due to the COVID-19 or other unforeseen circumstances.
Reservations are on a first-come-first-served basis. We advise you to apply early.
●Please apply at least one month before the lecture.
●In consideration of the topics discussed in the lectures, we do not approve applications from students in their 4th year of elementary
school or younger.
●Your application may not be approved if we receive too many applications or for our own business reasons. If this happens, we willcontact you before the lecture.
●
●

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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

History of Demining Activities (International Treaties,
Japanese government and Komatsu)
Year
1998
1999
2002
2003
2004
2006
2007
2008
2009
2010
2015
2016
2017
2019
Since
2020

Activity (international treaties and activities of the Japanese government are underlined)
Komatsu develops old timber removal machine for demining in Cambodia
The Ottawa Treaty is enacted (the Mine Ban Convention)
The Japanese government states it would exclude antipersonnel demining machine from the Three Principles on
Arms Exports
A subsidized project by the Ministry of Economy, Trade and Industry and NEDO(*) develops demining
machine (Figure (1) below)
With support from the Ministry of Foreign Affairs of Japan, Komatsu conducts on-site testing in Afghanistan
With support from the Ministry of Foreign Affairs of Japan, Komatsu conducts on-site testing in Cambodia
The first machine is introduced in Afghanistan (Japanese government ODA)
Komatsu begins the Cambodia reconstruction project jointly with the JMAS, an incorporated NPO
Komatsu begins the Angola reconstruction project jointly with the JMAS, an incorporated NPO
The Oslo Treaty is enacted (the treaty banning Cluster Munitions)
Komatsu develops demining machine (Figure (2) below)
Komatsu begins the Laos reconstruction project jointly with the JMAS, an incorporated NPO
Komatsu completes the Angola reconstruction project
Komatsu constructs its 9th elementary school in Cambodia, and 1st in Laos.
Komatsu begins the agriculture CSR project in Cambodia
The Cambodia and Laos reconstruction projects are continuing（＊NEDO：New Energy and Industrial Technology Development Organization）(1) Demining Machine(2) Demining Machine for processing unexploded ordnance203

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Promoting Sports—The Komatsu Women's Judo ClubFounded in 1991 as part of social contribution activities during the 70th anniversary of the company founding, the Komatsu Women's
Judo Club is celebrating its 30th year. Since its establishment, a total of 90 athletes have participated in competitions worldwide. The
club has actively engaged in teaching judo at home and abroad, and in welcoming foreign judo competitors, with the goal to develop
and popularize this sport.

Results of Club Activities in FY2020

In 2020, COVID-19 changed world affairs very quickly. The Tokyo Olympics were postponed until the following year. Many otherscheduled events were cancelled or postponed. Shortly after that, some domestic events gradually resumed with no spectators. The
Empress Cup All Japan Women’s Judo Championships took place in December and Wakaba Tomita won it for the first time. In the final,
she faced Akemi Hashimoto, another participant from the Komatsu Women's Judo Club. Neither contestant backed down throughout
the great 15-minute match. Wakaba Tomita also won the Kodokan Cup All Japan Women’s Weight Category Championships for two
consecutive years. Tomita made a leap forward in 2020.

Wakaba Tomita, winner of the Empress Cup

Tomita (right) competes against Hashimoto (left) in the final

Komatsu Women’s Judo Club

Social Contribution Activities through JudoThe Komatsu Women’s Judo Club has continued to coach the Komatsu Kids Judo Club in Tokyo, while also directing and coaching judoclasses around the world, including Japan, aiming to popularize this sport and train the next generation of judoka.
In 2020, no judo classes were held due to the situation faced by society. Aside from this exceptional situation, we organize judo classes
every year in the places in Japan and overseas where Komatsu’ production bases are located, with more than 100 children usuallyparticipating overseas. Judo classes at the fairs of our domestic plants also encourage the participation of children who have had noexperience in the sport.

Judo class in Yaroslavl (2018)204

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Theme 1 :Enhancing
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Theme 2 :Developing People

Theme 3 :Growing with Society

Data

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Activities

Index

An employee-participatory social contribution program"One World One Komatsu"
Komatsu’s basic policy is to conduct CSR activities through its core business, and the company strives to achieve sustainable growth
together with society through the resolution of ESG issues. On the occasion of the 100th anniversary of its founding, Komatsu has
begun "One World One Komatsu," our first global social contribution initiative designed for all Komatsu Group employees to participate
in from around the world.
The theme of "One World One Komatsu" is "Environment and Sustainability," which is a common issue around the world and has a highaffinity with our business, and each and every employee will take part in activities that are familiar to them in their daily lives, such as"reducing water consumption" and "turning off lights in unused rooms.
In order to promote these activities, we have set up a dedicated platform that allows the entire group to consolidate the activities ofeach individual. This new platform can be easily logged in from a PC or smartphone. Komatsu will continue to promote activities for asustainable planet by fostering a sense of unity among Komatsu Group employees around the world, transcending differences incountries and languages, and working toward a common goal.

Four priority themes of "One World One Komatsu”
Reduction of CO2 emission
Water conservation
Renewable energy
Reduction of waste

Komatsu Earth Day Event on April 2021

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

On April 22, 2021, Komatsu Group employees around the world voluntarily took part in a 24-hour "Earth Day Challenge" to protect theenvironment in their communities.
This event can be seen in the video (in multiple languages).

https：//www.youtube.com/playlist?list=PLl09JNAS3JlEgHkUWebDvJlCWaJaQqm3L

Achievements through Actions taken on the Komatsu Earth Day
Planting more than 14,000 trees and native species
Picking up more than 3,500 bags of trash
Volunteering more than 15,000 hours collectively

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

Index

GRI STANDARDS INDEX208

SASB Content Index

220

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

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

100 series (Universal)
Aspects

Indicators
102-1
102-2
102-3
102-4
102-5
102-6
102-7

Organizational
Profile

102-8
102-9
102-10Description
Name of theorganization
Activities, brands,
products, andservices
Location of
headquarters
Location ofoperations
Ownership and legal
form
Markets served
Scale of theorganization
Information on
employees and otherworkers
Supply chain
Significant changes tothe organization andits supply chain

102-11

Precautionary
Principle or approach102-12External initiatives

102-13

Membership ofassociations

Reference
Company Info: Corporate Profile
Company Info: Corporate Profile
Company Info, Industries We Support
Company Info, Technology and Innovation
Company Info: Corporate Profile
Company Info, Global Operations
Company Info: Corporate Profile
Company Info, Global Operations
Company Info: Corporate Profile
ESG Databook: Personnel Policy and Performance Appraisal
SystemESG Databook: Outline of Procurement Policy and Supply Chain(None for FY2020)
Investor Relations: Corporate Governance
ESG Databook: Risk Management
ESG Databook: Compliance
ESG Databook: Promoting Legal Compliance, and Pollution
Mitigation and Prevention
ESG Databook: Management of Chemical Substances and Pollution
Prevention
UN Global Compact
World Business Council for Sustainable Development (WBCSD)The Task Force on Climate-related Financial Disclosures (TCFD)PDF
ESG Databook: External Evaluations
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Aspects
Strategy

Ethics andIntegrity

Theme 1 :Enhancing
Quality of Life

Indicators
102-14102-15

Theme 2 :Developing People

Theme 3 :Growing with Society

Description
Statement fromsenior decision-maker
Key impacts, risks,and opportunities

102-16

Values, principles,standards, and normsof behavior

102-17

Mechanisms foradvice and concerns
about ethics

Governance102-18Governance structure102-19Delegating authority

102-20102-21

102-22102-23102-24

Executive-level
responsibility foreconomic,
environmental, andsocial topics
Consulting
stakeholders on
economic,
environmental, andsocial topics
Composition of thehighest governancebody and its
committees
Chair of the highest
governance body
Nominating andselecting the highest
governance body102-25

Conflicts of interest

102-26

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

Data

SocialContribution
Activities

Index

Reference
KOMATSU REPORT: Message from the PresidentPDF
Investor Relations: President interview
ESG Databook: Risk Management
KOMATSU REPORT 2020 Climate Change IssuesPDF
Company Info, Komatsu's Worldwide Code of BusinessConductPDF
ESG Databook: Compliance
ESG Databook: The KOMATSU Way
ESG Databook: Compliance
Investor Relations: Corporate Governance
KOMATSU REPORT: Corporate GovernancePDF
ESG Databook: Organization to Promote CSR
ESG Databook: Organizational Chart of the Environmental
Management Structure
ESG Databook: Organization to Promote CSR
ESG Databook: Organizational Chart of the Environmental
Management Structure
ESG Databook: Organization to Promote CSR
ESG Databook: Organizational Chart of the Environmental
Management Structure
ESG Databook: Organization to Promote CSR
ESG Databook: Dialogue with Our Stakeholders
ESG Databook Materiality(Formulating CSR Themes)Company Info: Directors, Auditors and Officers
KOMATSU REPORT: Corporate GovernancePDF
Investor Relations: Corporate Governance
Company Info: Directors, Auditors and Officers
Investor Relations: Corporate GovernanceCorporate Governance ReportPDF
Results of the Exercise of Voting Rights(Extraordinary Report)PDF
Company Info, Komatsu's Worldwide Code of BusinessConductPDF
KOMATSU REPORT: Corporate GovernancePDF
ESG Databook: Organization to Promote CSR
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Aspects

Theme 1 :Enhancing
Quality of Life

Indicators
102-27102-28102-29102-30102-31
102-32102-33102-34102-35102-36102-37102-38102-39

Stakeholder
Engagement102-40102-41
102-42

Theme 2 :Developing People

Theme 3 :Growing with Society

Description
Collective knowledgeof highest governancebody
Evaluating the highest
governance body's
performance
Identifying andmanaging economic,
environmental, andsocial impacts
Effectiveness of risk
management
processes
Review of economic,
environmental, andsocial topics
Highest governancebody’s role insustainability
reportingCommunicating
critical concerns
Nature and total
number of criticalconcerns
Remuneration
policies
Process fordetermining
remuneration
Stakeholders’involvement inremuneration
Annual totalcompensation ratio
Percentage increasein annual totalcompensation ratio
List of stakeholder
groupsCollective bargaining
agreements
Identifying andselecting stakeholders

Data

SocialContribution
Activities

Index

Reference
ESG Databook: Organization to Promote CSR
Corporate Governance ReportPDF
KOMATSU REPORT Corporate GovernancePDF
ESG Databook: Formulating CSR Themes (Materiality)
KOMATSU REPORT 2020 Climate Change IssuesPDF
ESG Databook: Risk Management
KOMATSU REPORT 2020 Climate Change IssuesPDF
ESG Databook: Risk Management
KOMATSU REPORT 2020 Climate Change IssuesPDF
ESG Databook: Organization to Promote CSR
ESG Databook: Risk Management
Annual Securities Report : CompensationPDF
Notice of Convocation Remuneration for Directors and Audit &Supervisory Board Members PDF
Annual Securities Report : CompensationPDF
ESG Databook: Dialogue with Our Stakeholders
ESG Databook: Personnel Policy and Performance Appraisal
System210

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Aspects

Theme 1 :Enhancing
Quality of Life

Indicators
102-43102-44102-45

Reporting
Practice

102-46102-47102-48102-49102-50102-51
102-52

Report Profile

102-53102-54102-55102-56
103-1

Management
Approach

103-2
103-3

Theme 2 :Developing People

Theme 3 :Growing with Society

Description
Approach to
stakeholder
engagement
Key topics andconcerns raised
Entities included in
the consolidated
financial statements
Defining reportcontent and topic
Boundaries
List of material topics
Restatements of
information
Changes in reporting
Reporting period
Date of most recent
reportReporting cycle
Contact point forquestions regarding
the report
Claims of reporting inaccordance with the
GRI Standards
GRI content index
External assurance
Explanation of thematerial topic and its
Boundary
The management
approach and its
components
Evaluation of the
management
approach

Data

SocialContribution
Activities

Index

Reference
ESG Databook: Dialogue with Our Stakeholders
Annual Securities Report: Overview of Subsidiaries andAffiliatesPDF
Company Info, Subsidiaries and Affiliates
ESG Databook: Formulating CSR Themes (Materiality)
ESG Databook: Editorial Policy
ESG Databook: Editorial Policy
Contact for Other Inquiries
GRI STANDARDS INDEXESG Databook: Independent Practitioner's Assurance

ESG Databook: Formulating CSR Themes (Materiality)

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

200 series (Economic topics)
Aspects

Economic
Performance

Indicators

Description

201-1

Direct economic value
generated anddistributed

201-2
201-3
201-4
202-1

MarketPresence
202-2
203-1
Indirect
Economic
Impacts203-2

Procurement
Practices

204-1

Anticorruption

205-1

Financial implications
and other risks andopportunities due toclimate change
Defined benefit plan
obligations and otherretirement plans
Financial assistancereceived fromgovernment
Ratios of standard
entry level wage by
gender compared to
local minimum wage
Proportion of senior
management hiredfrom the local
community
Infrastructure
investments andservices supported
Significant indirect
economic impacts
Proportion of
spending on local
suppliers
Operations assessed
for risks related tocorruption

Reference
ESG Databook: Personnel Policy and Performance Appraisal
System (remuneration data)
ESG Databook: Enhancing Work-Life Balance (Work-Life Balance
Data)
Annual Securities Report: Income TaxesPDF
ESG Databook: Developing People Needed by the Community
ESG Databook: Initiatives for Social Issues
ESG Databook: Disaster Relief
ESG Databook: Mitigating Climate Change through Products andServices
ESG Databook: Initiatives to Mitigate Climate Change in Business
Operations
Annual Securities Report: Pension and Retirement BenefitsPDF
ESG Databook: Diversity Initiatives
ESG Databook: Initiatives for Social Issues
ESG Databook: Disaster Relief
SMARTCONSTRUCTION
Investor Relations: President interview
ESG Databook: Developing People Needed by the Community
ESG Databook: Initiatives for Social Issues
ESG Databook: Disaster Relief
ESG Databook: Outline of Procurement Policy and Supply Chain-212

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Aspects

Theme 1 :Enhancing
Quality of Life

Indicators
205-2
205-3

Anticompetitive
Behavior

206-1
207-1
207-2

Tax

207-3
207-4

Theme 2 :Developing People

Theme 3 :Growing with Society

Description
Communication andtraining about anticorruption policies
and procedures
Confirmed incidentsof corruption andactions taken
Legal actions for anticompetitive behavior,anti-trust, andmonopoly practices
Approach to tax
Tax governance,
control, and risk
management
Stakeholder
engagement andmanagement ofconcerns related totax
Country-by-country
reportingSocialContribution
Activities

Data

Index

Reference
ESG Databook: Compliance
ESG Databook: Compliance
Annual Securities Report: Financial InformationPDF
Annual Securities Report: Financial InformationPDF
Annual Securities Report: Financial InformationPDF
Annual Securities Report: Financial InformationPDF

300 series (Environmental topics)
Aspects

Materials

Indicators
301-1

Description
Materials used byweight or volume301-2

Recycled input
materials used

301-3
Energy

302-1
302-2

Reclaimed products
and their packaging
materials
Energy consumption
within theorganization
Energy consumption
outside of theorganization

302-3

Energy intensity

302-4

Reduction of energy
consumption

Reference
ESG Databook: Relationship between Business Activities and theEnvironment (Input and Output)
ESG Databook: Activities to Effectively Utilize Resources in
Production
ESG Databook: Activities to Effectively Utilize Resources in
Production
ESG Databook: Relationship between Business Activities and theEnvironment (Input and Output)
Scope of Environmental Data, etc
ESG Databook, Site Data
ESG Databook, Input/Output
ESG Databook, Site Data
ESG Databook, Input/Output
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Management ofEnvironmental andSocial Initiatives

Aspects

Theme 1 :Enhancing
Quality of Life

Indicators
302-5
303-1

Water andEffluents

303-2

Description
Reductions in energy
requirements ofproducts and services
Interactions withwater as a sharedresource
Management of water
discharge-related
impacts
Water withdrawal

303-4
303-5

Water discharge
Water consumption
Operational sites
owned, leased,managed in, or
adjacent to, protectedareas and areas ofhigh biodiversity
value outside
protected areas
Significant impacts ofactivities, products,
and services on
biodiversity
Habitats protected or
restored
IUCN Red List species
and national
conservation list
species with habitats
in areas affected byoperations
Direct (Scope 1) GHG
emissions
Energy indirect(Scope 2) GHG
emissions

304-2
304-3
304-4

EMISSIONS

Theme 3 :Growing with Society

303-3

304-1

BIODIVERSITY

Theme 2 :Developing People

305-1
305-2
305-3

Other indirect (Scope
3) GHG emissions

305-4

GHG emissions
intensity
Reduction of GHG
emissions

305-5

Data

SocialContribution
Activities

Index

Reference
ESG Databook: Reduction in CO2 Emissions of Construction
Equipment
ESG Databook, Efforts regarding water
ESG Databook, Efforts regarding water
ESG Databook, Environmental Impact
ESG Databook, Efforts regarding water
ESG Databook, Efforts regarding water
ESG Databook, Input/Output-

ESG Databook, Environmental Impact
ESG Databook, Calculation base
ESG Databook, Environmental Impact
ESG Databook, Calculation baseAmount of CO2 Emissions by Scope 3
Amount of CO2 Emissions by Scope3
Scope of Environmental Data, etc
ESG Databook: Initiatives to Mitigate Climate Change in Business
Operations214

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Aspects

Indicators
305-6
305-7
306-1
306-2

EFFLUENTS AND
WASTEENVIRONMENTALCOMPLIANCE

Theme 2 :Developing People

Theme 3 :Growing with Society

Description
Emissions of ozonedepleting substances(ODS)
Nitrogen oxides(NOX), sulfur oxides(SOX), and othersignificant air
emissions
Waste generation andsignificant wasterelated impacts
Management ofsignificant wasterelated impacts

306-3

Waste generated

306-4

Transport ofhazardous waste

306-5

Waste directed todisposal

307-1
308-1

SUPPLIER
ENVIRONMENTAL
308-2

Non-compliance withenvironmental laws
and regulations
New suppliers thatwere screened using
environmental
criteria
Negativeenvironmental
impacts in the supply
chain and actions
taken

Data

SocialContribution
Activities

Index

Reference
ESG Databook: Relationship between Business Activities and theEnvironment (Input and Output)
Scope of Environmental Data, etc
ESG Databook: Inputs and outputs in the product life cycle
ESG Databook: Development of our “Reman” Remanufacturing
Business
ESG Databook: Green Procurement Guidelines
ESG Databook: Activities to Effectively Utilize Resources in
Production (1. Waste)
ESG Databook: Inputs and outputs in the product life cycle
ESG Databook: Activities to Effectively Utilize Resources in
Production (1. Waste)
ESG Databook: Inputs and outputs in the product life cycle
ESG Databook: Environmental Risk Management
-

-

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Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

Data

SocialContribution
Activities

Index

400 series (Social topics)
Aspects

Indicators
401-1

Employment

401-2
401-3

Labor/
Management
Relations

402-1
403-1
403-2
403-3
403-4

Occupational
Health and
Safety

403-5
403-6
403-7

403-8
403-9
403-10Description
New employee hires
and employee
turnoverBenefits provided tofull-time employeesthat are not provided
to temporary or parttime employees
Parental leave
Minimum notice
periods regarding
operational changes
Occupational healthand safety
management system
Hazard identification,risk assessment, andincident investigation
Occupational healthservices
Worker participation,
consultation, andcommunication on
occupational healthand safety
Worker training on
occupational healthand safety
Promotion of worker
healthPrevention andmitigation ofoccupational healthand safety impacts
directly linked bybusiness relationships
Workers covered byan occupational
health and safety
management system
Work-related injuries
Work-related ill health

Reference
ESG Databook: Personnel Policy and Performance Appraisal
System (Data on employment and turnover)
ESG Databook: Enhancing Work-Life Balance (Data on pregnancy
and childcare leaves)
ESG Databook: Occupational Safety and Health
ESG Databook: Occupational Safety and Health
ESG Databook: Occupational Safety and Health
ESG Databook: Occupational Safety and Health
ESG Databook: Occupational Safety and Health
ESG Databook: Occupational Safety and Health
ESG Databook: Occupational Safety and Health

ESG Databook: Occupational Safety and Health
ESG Databook: Occupational Safety and Health
ESG Databook: Occupational Safety and Health216

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Aspects

Theme 1 :Enhancing
Quality of Life

Indicators
404-1

Training and
Education

404-2

404-3

Diversity and
Equal
Opportunity

405-1
405-2

Nondiscrimination

406-1

Freedom of
Association
and Collective
Bargaining

407-1

Child Labor

408-1

Forced orCompulsory
Labor

409-1

Security
Practices

410-1

Rights ofIndigenous
Peoples

411-1

Theme 2 :Developing People

Theme 3 :Growing with Society

Description
Average hours of
training per year per
employee
Programs for
upgrading employee
skills and transition
assistance programs
Percentage of
employees receiving
regular performanceand careerdevelopment reviews
Diversity of
governance bodies
and employees
Ratio of basic salaryand remuneration of
women to men
Incidents of
discrimination andcorrective actions
taken
Operations andsuppliers in which theright to freedom of
association andcollective bargaining
may be at risk
Operations andsuppliers at
significant risk forincidents of childlabor
Operations andsuppliers at
significant risk forincidents of forced orcompulsory labor
Security personnel
trained in humanrights policies orprocedures
Incidents of violations
involving rights ofindigenous peoples

Data

SocialContribution
Activities

Index

Reference
ESG Databook: Employee Training Structure (Data on employee
training)
ESG Databook: Employee Training Structure
ESG Databook: Strengthening Our Gemba Capability
ESG Databook: Diversity Initiatives (Rehiring of Retired Employees)
ESG Databook: Personnel Policy and Performance Appraisal
SystemESG Databook: Diversity Initiatives-

ESG Databook: Personnel Policy and Performance Appraisal
System (Data on employment and turnover)Company Info, Komatsu's Worldwide Code of BusinessConductPDF
ESG Databook: CSR Procurement Guidelines
Company Info, Komatsu's Worldwide Code of BusinessConductPDF
ESG Databook: CSR Procurement Guidelines-

217

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Aspects

Theme 1 :Enhancing
Quality of Life

Indicators
412-1

Human Rights
Assessment

412-2

412-3

413-1
Local
Communities
413-2
414-1
Supplier Social
Assessment
Public Policy

414-2
415-1
416-1

Customer
Health and
SafetyMarketing andLabeling

416-2

417-1

Theme 2 :Developing People

Theme 3 :Growing with Society

Description
Operations that havebeen subject tohuman rights reviews
or impactassessments
Employee training on
human rights policies
or procedures
Significant investment
agreements andcontracts that include
human rights clausesor that underwent
human rights
screening
Operations with local
community
engagement, impact
assessments, anddevelopment
programs
Operations withsignificant actual andpotential negative
impacts on local
communities
New suppliers thatwere screened usingsocial criteria
Negative social
impacts in the supply
chain and actions
taken
Political contributions
Assessment of thehealth and safety
impacts of productand service categories
Incidents of noncomplianceconcerning the healthand safety impacts ofproducts and services
Requirements for
product and service
information andlabeling

SocialContribution
Activities

Data

Index

Reference
ESG Databook: Risk Management
ESG Databook: CSR Procurement Guidelines
ESG Databook: Compliance

ESG Databook: CSR Procurement Guidelines

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

ESG Databook: Developing People Needed by the Community
ESG Databook: Komatsu Group's Supply Chain Management andPromotion of CSR Procurement
Political Contributions
ESG Databook: Improving Product Safety and Solutions-

218

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Aspects

Theme 1 :Enhancing
Quality of Life

Indicators
417-2

417-3

CustomerPrivacy418-1

Socioeconomic
Compliance

419-1

Theme 2 :Developing People

Theme 3 :Growing with Society

Description
Incidents of noncomplianceconcerning productand service
information andlabeling
Incidents of noncomplianceconcerning marketing
communications
Substantiatedcomplaints
concerning breachesof customer privacy
and losses ofcustomer dataNon-compliance withlaws and regulationsin the social andeconomic area

Data

SocialContribution
Activities

Index

Reference
-

-

-

-

219

ESG Databook 2021

Management ofEnvironmental andSocial Initiatives

Theme 1 :Enhancing
Quality of Life

Theme 2 :Developing People

Theme 3 :Growing with Society

SocialContribution
Activities

Data

Index

SASB Content Index
Topic

EnergyManagement

Employee Health& Safety

Accounting Metric

Reference(1) Total energy consumed

Environmental Impact Resulting from
Business Activities(2) Percentage gridelectricity

Environmental Impact Resulting from
Business Activities(3) Percentage renewable

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

Occupational Safety and Health(2) Employee fatality rate

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

Code

RT-IG-130a.1

RT-IG-320a.1-(1) Sales-weighted fleet fuel efficiency formedium- and heavy-duty vehicles

N/A

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

Reducing CO2 Emissions from ProductOperation

RT-IG-410a.2(3) Sales-weighted fuel efficiency forstationary generators

N/A

RT-IG-410a.3

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

NOx and PM Emitted from Products

RT-IG-410a.4

Materials
Sourcing

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

Effective Use of Critical Materials in
Products

RT-IG-440a.1

Remanufacturing
Design &Services

Revenue from remanufactured products
and remanufacturing services

Development of our “Reman”
Remanufacturing Business

RT-IG-440b.1

Topic

Accounting Metric

Reference

Code

Activity Metric

Number of units produced by productcategory

Environmental Impact Resulting from
Business Activities

RT-IG-000.A

Number of employees

Corporate Profile

RT-IG-000.B

Fuel Economy &Emissions in Usephase

220

ESG Databook 2021

KOMATSU
2-3-6, Akasaka, Minato-ku, Tokyo 107- 8414, Japan
https://home.komatsu/en/