KOKUYO Report

2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

KOKUYO's CSR Charter
While remaining profitable and honest in its business practices, KOKUYO conducts business that is necessary
for society.
In addition to complying with laws and regulations, we seek to maintain continuity of our business byacquiring the trust of all related stakeholders, investors, and, of course, our customers by fulfilling our social
responsibilities as a corporate citizen.

For Our Customers

1

Without being satisfied with the present conditions, we continue to improve the safety and quality of2

Strive to continually innovate society through our business operations by developing new products andour entire product line and services.
services.

For Regional Communities

1

Strive to be a trusted‘corporate citizen’on both regional and national levels via proactive interaction andplanning with regional communities, while respecting regional culture and customs and encouraging theiradvancement.

For Environmental Conservation

1

Concentrate the wisdom of each of our employees, and align the actions of our entire company in order2

By developing Eco Products, we strive to decrease the environmental burden over the life cycle of these3

Contribute towards the advancement of a‘low carbon society’by proposing revolutionary work styles

to assist in reaching solutions for the common environmental problems facing the world today.
Products and to introduce new environmental engineering and green procurement techniques.
and environments, and decrease society's overall burden on the environment.

Corporate Activities

1

Conduct transparent, just, and free competition and business transactions while keeping sound and2

In order to become a trusted company, we strive for business partner relations that are consistently fair3

Recognize our responsibility to increase our corporate value for stockholders, and maintain a corporate

correct relations with politicians and governmental bodies.
and built upon a foundation of reciprocal cooperation, allowing for mutual growth.
management style that earns the trust of society through its transparency and virtue.

Respect for Human Rights

1

Respect the human rights of all individuals involved with or affected by all of our corporate activities.
We support work environments free from discrimination, and do not approve of child labor or forcedlabor practices.

2

Strive to accept each and every employee's individual character and personal values, and become
a company where many different human resources can fully express their abilities and develop
themselves.

1

KOKUYO Group CSR Report 2018

Contents● KOKUYO s CSR Charter . . . . . . . . . . . . .

1....................

3● KOKUYO's Three Business Areas . . .

5● KOKUYO Group History . . . . . . . . . . . . .

7● KOKUYO's CSR . . . . . . . . . . . . . . . . . . . . . . .

9● Customers . . . . . . . . . . . . . . . . . . . . . . . . . . . .

29● Corporate Proﬁle● Regional Communities. . . . . . . . . . . . . . 41

● Environmental Conservation● Corporate Activities. . . . . . . 52

. . . . . . . . . . . . . . . . . 75

● Respect for Human Rights. . . . . . . . . . 92

● Third-Party Assessments. . . . . . . . . . . 112

Reporting Period
January 1, 2017 to December 31, 2017

Publication Period
Report published: May 2017
Next report to be published: April 2018
Previous report published: June 2016

Scope of the Report
The KOKUYO Group refers to KOKUYO Co., Ltd., and its domestic
and overseas Group companies, comprising 20 consolidated subsidiaries,
certain activities involve other subsidiaries and aﬃliates.

Reference Guidelines
・ISO26000
・Japanese Ministry of the Environment Environmental Reporting Guidelines 2012
・GRI (Global Reporting Initiative) Sustainability Reporting Guidelines 4th Edition

2

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Corporate Profile
Company name

KOKUYO Co., Ltd.

Head Office location

6-1-1 Oimazato-minami, Higashinari-ku, Osaka-shi, Osaka 537-8686 JAPAN

Telephone+81-6-6976-1221 (main switchboard)

Number of employees

6,699 (Consolidated) 2,014 (Parent company)*As of the end of December 2017

Stock listings

Tokyo Stock Exchange (First Section)

CapitalJPY 15.8 billion

Sales volume

JPY 315.6 billion (Consolidated from January 1 to December 31, 2017)

Business description

Stationery manufacturing, �urchasing, and sales;
office furniture manufacturing, purchasing, and sales;
space design and consultation, etc.

Directors
Members of the Board

Audit & Supervisory
Board Members

Managing Officers

Representative Director of the Board, Chairman

Akihiro Kuroda

Representative Director of the Board, President and CEO

Hidekuni Kuroda

Director of the Board, Vice Chairman

Yasuhiro Kuroda

Director of the Board

Takuya Morikawa

Director of the Board

Nobuyuki Miyagaki

Independent Director of the Board

Hisao Sakuta

Independent Director of the Board

Hiroshi Hamada

Independent Director of the Board

Taketsugu Fujiwara

Outside Audit & Supervisory Board Member(Full-time Outside Audit & Supervisory Board Member)

Kazutoshi Maeda

Outside Audit & Supervisory Board Member

Morihiro Murata

Outside Audit & Supervisory Board Member

Hideyuki Yasue

President and CEO

Hidekuni Kuroda

Senior Managing Officer, International Business Division

Takuya Morikawa

Senior Managing Officer, Corporate Administrations

Nobuyuki Miyagaki

Managing Officer, Finance & Accounting Division

Naotaka Umeda

Managing Officer, Furniture Business Division

Kozo Sakagami

Managing Officer, "Kaunet" Business Division(President & CEO, Kaunet Co.、Ltd.)

Kenichiro Takahashi

Managing Officer, Stationery Business Division

Masahiro Fukui

Financial data graphs
Sales & Operating profit rate

Consolidated sales composition(JPY100 million)(%)
3,300 -----------------------------------------s-:0% ― -- 6.0
3,200 ----------------------------------------- ------ 5.5
5.0%

Sales

2014
Dec.

25.2%

--- 3.5

2015
Dec.

2016
Dec.

Mail-order&
Retail Business

ー

2013
Dec.

Stationery Businessn~ 5 0 5
3 2 2

2、800 ---

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〗

三 =己ロー r.txi1::

Furniture Business

34.0%

2017
Dec.

* The sales ratios were calculated based on sales to external customers.

-+- Operating profit rate

3

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Major Subsidiary Companies
Japan- KOKUYO Tohoku Sales Co., Ltd.
Sendai TB Building, 4-3-10 Tsutsujigaoka,
Miyagino-ku, Sendai-shi, Miyagi 983-0852
TEL: +81-22-292-6594- KOKUYO Kitakanto Sales Co., Ltd.
3172-48 Tonya-machi, Utsunomiya-shi, Tochigi 321-0911
TEL: +81-28-656-5561- KOKUYO Hokuriku-Niigata 5ales Co., Ltd.
2-17-2 Kurose Kitamachi, Toyama-chi, Toyama 939-8216
TEL: +81-76-491-5946- KOKUYO Tokai Sales Co., Ltd.
Katoken Building, 1-4-10 Kamimaezu, Naka-ku,
Nagoya-shi, Aichi 460-0013
TEL: +52-324-5941- KOKUYO Sanyo-Shikoku Sales Co., Ltd.
6F Sumitomo Seimei Okayama New City Building, 3-10 Togiya-cho,
Kita-ku, Okayama-Shi, Okayama 700-0826
TEL: +81-86-225-5943[Stationery Business]- KOKUYO Product Shiga Co., Ltd
312 Kamigano, Aisho-cho、Echi-gun, Shiga 529-1203
TEL: +81-749-37-3611- KOKUYO MVP Co., Ltd.
2-201 Minami, Koyama-cho, Tottori-shi, Totton
TEL: +81-857-28-0241- KOKUYO Supply Logistics Co., Ltd.
6-1-1 Oimazato-minami, Higashinari-ku,Osaka-shi, Osaka 537-8686
TEL: +81-6-6976-1370- IWAMI Paper Industry Co., Ltd.
1-378 Ushiroda, Tsuwano-cho, Kanoashi-gun,Shimane 699-5605
・[Furmture Business]- KOKUYO Engineering & Technology Co., Ltd.
SF Estage Osaki, 3-5-2 Osaki,Shinagawa-ku, Tokyo 141-0032
TEL: +81-3-5436-7407- KOKUYO Logitem Co., Ltd.
6-1-1 Oimazato-minami, Higashinari-ku,Osaka-shi, Osaka 537-8686
TEL: +81-6-6973-9470- Wilkhahn Japan Co., Ltd.
B1F Tokyo Tatemono Aoyama Building,
3-5-5 Kita-Aoyama, Minato-ku, Tokyo 107-0061
TEL: +81-3-5414-8088- CW Facility Solution Inc
1-8-35 Konan, Minato-ku, Tokyo 108-8710
TEL: +81-3-3474-6530[Other Major Subsidiaries]- POSTALSOUARE Co., Ltd
11F Mita 3-chome MT Building, 3-14-10 Mita,Minato-ku, Tokyo 108-0073
TEL: +81-3-5439-4701- KOKUYO & Partners Co.、Ltd.
18F Kasumigaseki Building, 3-2-5 Kasumigasek,,
Chiyoda-ku, Tokyo 100-6018
TEL: +81-3-5510-4552- KOKUYO K Heart Co., Ltd.
6-8-10 Oimazato-minami, Higashinari-ku,
Osaka-shi, Osaka 537-8686
TEL: +81-6-6973-9322- Heartland Co., Ltd.
2018 Hatashiro, Sennan-shi, Osaka 590-0524
TEL: +81-72-480-0567- KOKUYO Finance Co., Ltd
6-1-1 Oimazato-minami, Higashinari-ku, Osaka-shi, Osaka 537-8686
TEL: +6-6976-1221[Mail-order & Retail Business]- Kaunet Co., Ltd.
16F Nissay Aroma Square, 5-37-1 Kamata, Ota-ku,Tokyo 144-8721
TEL: +81-3-6800-5700- Actus Co.、Ltd.
12F BYGS Shinjuku Building, 2-19-1 Shinjuku,Shinjuku-ku, Tokyo 160-0022
TEL: +81-3-5269-3201[Sales Subsidiaries]- KOKUYO Marketing Co.、Ltd.
18F Kasumigaseki Building, 3-2-5 Kasumigasek,,
Chiyoda-ku, Tokyo 100-6018
TEL: +81-3-5510-3146- KOKUYO Hokkaido Sales Co., Ltd
5-1-7 Higashi Sapporo Gojo, Shiroishi-ku, Hokkaido 003-0005
TEL: +81-11-815-5940

Overseas[Stationery Business]- KOKUYO Vietnam Co., Ltd.
Land Plot B2-B7, Nomura-Haiphong IZ, Km13,An Duong Dist., Hai Phong City、Vietnam
TEL: +84-225-3743257- KOKUYO Vietnam Trading Co., Ltd.
Land Plot B2-B7, Nomura-Haiphong IZ, Km13,An Duong Dist., Hai Phong City, Vietnam
TEL: +84-225-3743422
KOKUYO
2F[Furniture Business]- KOKUYO Malaysia Sdn. Bhd.
Lot 79&83、Senawang Industrial Park,70400 Seremban, NSDK, Malaysia
TEL: +60-6-679-6096- KOKUYO Furniture (China) Co., Ltd.
1F Xinjinqiao Square, No.7 West Beijing Road、
Huangpu District, Shanghai, 200003 P.R.CHINA
TEL: +86-21-6141-3001- KOKUYOF

KOKUYO-IK (Thailand)
529 Moo 4 Bangpoo Industrial Estate10280,

Wanchai, Hong

KOKUYO International
999/9 The Office at Central World 9th Fl, Unit
Rama 1 Rd., Pathumwan Bangkok, 10330、[Other4

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

KOKUYO's Three Business Areas

W orking

Proposing spaces that bring out the bestin individuals, inspire creative work,and support the wellbeing of staff
In recent years, against a background of an aging
population with a declining birthrate and changes tothe fundamental sense of values of working people, anemphasis has been given to the creation of a work
environment bringing out the best in individuals andsupporting them to work in good health. In response
to such trends, KOKUYO will keep proposing work
spaces increasing employee motivation and nurturing
team creativity.

5

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

ヽ

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．ng
I�
earn1

Supporting various learning styles

across all generations
Learning alone, learning with friends or colleagues,

learning while working, learning while child-rearing,learning for a new career and learning at any age…

Different ways oflearning matching an individual's
lifestyle are now spreading across the generations.

Through the development and the sale ofstationery

and furniture, and the creation ofspaces for learning,

KOKUYO continues supporting diverse learning styles.

that make life even better
The boundaries between working, learning,

and living are slowly fading away, as increasing

Li
vi
ng

Delivering products

numbers ofpeople make the best use oftheirtime and space to improve their lives.

And for every single one ofthem KOKlNO offersa variety ofproducts and services, and supports

them in enhancing their quality oflife.

6

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

7

Customers

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

8

Customers

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

KOKUYOʼs CSR

Aiming to Achieve the Goals in our Medium-term Management Plan: "Self-reform Focusing on
Value Creation - Value Transformation 2018"
We established the following as our mission statement for the future: "KOKUYO aims to be a Life & Work Style
Company that enriches society by providing value through our products and services to enhance customers' creativity
and to deliver improvements to their Quality of Life so that they can work, learn and live better." To this end, since
FY2016, under the three-year, medium-term management plan "Self-reform focusing on value creation - Value
Transformation 2018," we have been working on "operating model reform" that realizes customer-oriented value
creation and the "development of sustainable profitability" to enable medium- to long-term sustainable growth.
We were able to finish FY2017, the second year of this plan, with the highest gross margin since our company was
listed on the Tokyo Stock Exchange. In terms of our operating margin, we were able to achieve last year's goal (5.0%)
one year ahead of schedule, making FY2017 an extremely successful year financially. FY2018 will be the last year of
this plan. We plan to review our goals one more time and forge ahead toward achieving them.

Implementing Work Style Reform at Our Own Workplace in the Pursuit of New Work Styles
Societal issues - such as Japan's low birth-rate and ageing population, changes in young people's values (work values),
the focus on health and productivity management, and intensifying global competition - are becoming more diversified
and complicated. In this context, both private and public sectors are promoting discussion and initiatives related to work
style reform. As a company that has always pursued products and services that provide high added value to working
people, we have for many years been facing the question of "What kind of unique work style reform can KOKUYO help
to achieve?"
In 2017, in order to take our initiatives one step further and foster a corporate culture that draws out value from ouremployees, we established the Tokyo Shinagawa SST Office. With the goal of re-centralizing and optimizing all
management resources, improving efficiency, and seeking a KOKUYO-style work style, all departments are located on asingle floor in the new office. By removing physical and psychological barriers between departments to ensure smoothcommunication and enhanced collaboration, the new office is designed to improve workplace productivity. We believethat the experience of thinking over, trying out, and implementing such work style reform ourselves will lead tosuggestions that are beneficial to our customers.
9

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

To All Stakeholders
KOKUYO has built its history of more than 100 years by earnestly facing customers' needs as they changed with thetimes, and finding the solution for each one. This attitude remains the same today, although these are said to be
uncertain times as societal issues and corporate business activities have become entangled with increased complexity.
We are committed to continue doing our utmost to work on creating new value that contributes to the realization of asustainable society, by placing importance on facing issues of both customers and society at large.

10

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

KOKUYOʼs CSR

KOKUYO's founder Zentaro Kuroda once said: "Business is something that we do for society, and the profit we gainfrom business is a reward for our contribution to society." Now too, more than 100 years on from KOKUYO's foundation,
we are keeping alive the spirit of our founder in our CSR activities.

Concepts
Basic Concepts
The KOKUYO Group began when founder Zentaro Kuroda opened a small shop selling ledger covers made withJapanese paper in 1905. The founder moved from his village to Osaka with the aspiration of making his business the
pride of his hometown Etchu (present-day Toyoma Prefecture). Through the brand Kokuyo (国誉), which is the current
company name KOKUYO (コクヨ), his aspiration has been passed down to the KOKUYO Group and captured in its
business. In 2004, we enacted the KOKUYO Group CSR Charter based on our corporate philosophy to establish better
relations with various stakeholders as a good corporate citizen (which was partially revised in 2012). Our basic policy forensuring the ongoing growth of society and the KOKUYO Group has been clarified in line with five key themes: ourcustomers, regional communities, environmental conservation, corporate activities, and respect for human rights.
※ Related information: "KOKUYO Group CSR Charter"

System for the Promotion of CSR
The KOKUYO Group promotes CSR activities on a group-wide basis through linkages among CSR-related sections.
The CSR & Environmental Group formulates and reviews policies and helps to define issues and targets in order tostrategically promote CSR. We also operate an environmental committee and a central health and safety committee,
among other such organs tasked with dealing with important concerns. With special sections leading the way, our entire
group pursues these concerns in a coordinated fashion. We will continue to strive to achieve sustained growth forsociety and the Group while maintaining a state of harmony with stakeholders through CSR information disclosure anddialogue.

KOKUYO's CSR Charter
While remaining profitable and honest in its business practices, KOKUYO conducts business that is necessary forsociety. In addition to complying with laws and regulations, we seek to maintain continuity of our business by acquiring
the trust of all related stakeholders, investors, and, of course, our customers by fulfilling our social responsibilities as acorporate citizen.

11

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

1. Without being satisfied with the present conditions, we continue to improve the safety and quality of
our entire product line and services.
2. Strive to continually innovate society through our business operations by developing new products
and services.

1. Strive to be a trusted ‘corporate citizen’ on both regional and national levels via proactive interaction
and planning with regional communities, while respecting regional culture and customs andencouraging their advancement.

1. Concentrate the wisdom of each of our employees, and align the actions of our entire company inorder to assist in reaching solutions for the common environmental problems facing the world today.
2. By developing Eco Products, we strive to decrease the environmental burden over the life cycle ofthese Products and to introduce new environmental engineering and green procurement techniques.
3. Contribute towards the advancement of a ‘low carbon society’ by proposing revolutionary work styles
and environments, and decrease society's overall burden on the environment.

1. Conduct transparent, just, and free competition and business transactions while keeping sound andcorrect relations with politicians and governmental bodies.
2. In order to become a trusted company, we strive for business partner relations that are consistently
fair and built upon a foundation of reciprocal cooperation, allowing for mutual growth.
3. Recognize our responsibility to increase our corporate value for stockholders, and maintain acorporate management style that earns the trust of society through its transparency and virtue.

1. Respect the human rights of all individuals involved with or affected by all of our corporate activities.
We support work environments free from discrimination, and do not approve of child labor or forcedlabor practices.
2. Strive to accept each and every employee's individual character and personal values, and become acompany where many different human resources can fully express their abilities and develop
themselves.

12

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Kokuyo Group Code of Conduct
Accompanying the development of KOKUYO's overseas activities, it is necessary to prepare a common code of conduct
for the group by taking into account of local customs and mores. In August 2012, the KOKUYO Group enacted its
KOKUYO Group Code of Conduct as a set of common provisions applicable to the KOKUYO Group and prepared the
KOKUYO Group Code of Conduct Handbook with supplementary points based on business practices, laws, and othermatters that differ depending on the country or region.

1. Compliance with laws and internal rules and acting with integrity
We not only comply with laws and internal rules, but also act with high ethical standards and integrity.
2. Respect for human rights and personality
We do not discriminate based on race, ethnicity, religion, nationality, language, gender, disability or other status.
We do not engage in conduct that constitutes sexual harassment or power harassment.
We do not tolerate child labor or forced labor.
3. Preservation of the global environment
We work to eliminate or reduce the environmental burden whilst focusing on global environmental issues, such as
global warming and declining forest resources.
4. Free competition and fair trading
We comply with laws and internal rules related to prohibition of monopolization, fair competition and fair trading andwill not engage in conduct that deviates from these standards.
5. Provision of safe and reliable goods and services
We strive to win customers' satisfaction continuously through the provision of safe and reliable goods and services.
6. Proper handling of company assets and protection of intellectual property
We properly manage, maintain, and utilize every tangible and intangible company asset. We respect the intellectual
property rights of others.
7. Proper information management and financial reporting
We honestly and properly create records of the company, as well as manage and report information collected andobtained in the course of business in accordance with proper procedures based on the materiality of suchinformation. We carry out accounting and financial reporting in compliance with laws and internal rules relevant tofinancial, accounting, and tax affairs.
8. Prohibition of acts involving conflicts of interest
We will not engage in any act that involves or may involve a conflict between personal and corporate interests. If
there is a possible conflict of interest, we will report it to our superiors.
9. Prohibition of insider trading
We will not engage in insider trading or any act that triggers insider trading laws or regulations in connection with thetrading in shares of the Kokuyo Group or any other company
10. Proper management of entertainment and gifts
We will not give or receive entertainment and gifts in deviation from normal business practices. We will not illegally
give entertainment or gifts to public servants or government officials.
11. Handling of unreasonable external demands
We will not comply with any unreasonable external demand.

13

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

With Stakeholders
KOKUYO's Stakeholders
Working towards realizing a sustainable society, the KOKUYO Group is actively promoting CSR management to meetthe expectations of various stakeholders including customers, shareholders, partner companies and local communities.

Stakeholder Communication

Stakeholder

Main opportunities for dialogue
Customer Support Center

Customers"Inquiries" form and Q&A page on
websiteProvision of various product information
Management of "Dealers' Guide" wherestores handling KOKUYO products canbe searched from the website
Various events and seminars

Examples of implementation in FY2017

A System for Utilizing Feedback from
Customers
Soft Ring® Notebooks and Memo Pads
<Colorful> (dotted ruled lines)(perforated)
Kaunet Holds First-ever Exposition"Kaunet Festival"

The First Joint Sports Day Held with
Employees and Family Members of
KOKUYO Group Companies in China
Employees

Consultation between labor andmanagement
Various training programs

Furniture Business Division UnityStrengthening Meeting to Promote
Knowledge, Interchange, and Unity
Product Training that also Serves as a
Platform for Intergroup Exchange

Company newsletter

Open Challenge Program that Expand
Visions through Interactions with
Human Resources from Different
Industries
Work Style Reform Suggestion
Committee Started with Retailers forTrue Work Style Reform
Clients

New Product Briefing Held in Hanoi,
Vietnam, Inviting Partner Companies

Audit of subcontractors
Various meetings and events
Holding exhibitions

Events Held to Celebrate the 20th
Anniversary of the Founding of
KOKUYO Malaysia
Subcontractor Meetings Held by
Kokuyo's Furniture Business Division
Stationery Business Conducted an
Audit of Subcontractors

Stakeholders

Shareholder special benefit plans

IR activities"Company information session: Story of'Dotliner' tape glue development"

Information disclosure

14

KOKUYO Group CSR Report 2018

KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Stakeholder

Main opportunities for dialogue

Customers

Examples of implementation in FY2017
The 15th KOKUYO Design Award 2017with "New Story" Theme

Regional
Communities

Summer Vacation KOKUYO Logistics
Center Tour for Parents and Children
Held
Local Cleanup Activities and Blood
Donation

Social contribution activities
Disaster recovery activities
Regional contribution activities

Campus Art Award 2017, a Painting
Competition for Junior High and HighSchool Students
Chasing Big Dreams with Small
Notebooks! - Handing Dreams andBooks to Children
World Art Day 2017

Environment

Global warming preventive measures

Summary for 2017

Resource-saving and recycling

Improving the accuracy of data on
waste materials

Concern for biodiversity

15

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KOKUYO s CSR Charter

Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

KOKUYOʼs CSR

GRI Standards content index

Description

Core
QuestionsStandards

GRI Standards Questions

Page

General Disclosures
102: General Disclosures
○

102-1

Name of the organization

○

102-2

○

102-3

Location of headquarters

Corporate Data

○

102-4

Location of operations

Locations

○

102-5

Ownership and legal form

Corporate Data

○

102-6

Markets served

Business Overview

Activities, brands, products,
and services

Corporate Data

Business Overview

Corporate Data
1.
Organizational
profileLocations○

102-7

Scale of the organization
Earnings Highlights
Financial Position

○

102-8

○

102-9

○

102-10Information on employees
and other workers

CSR Data: Society

Supply chain
Significant changes to theorganization and its supply
chain

○

102-11

Precautionary Principle orLabor Practices/Safety andapproach

Health16

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KOKUYO Group History

KOKUYO s CSR

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

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Description

1.

Core
QuestionsStandards

GRI Standards Questions○

102-12External initiatives○

102-13

Membership of associations○

102-14

Organizational
profile2.
Strategy102-15

Customers

Statement from seniordecision-maker

Page

Commendation and
Recognitions from Outside

Message from the President

Key impacts, risks, andSecurities Report p15

opportunities(Japanese)（1.39MB）

KOKUYO's CSR Charter3.

○

102-16

Values, principles, standards,
and norms of behavior

Ethics and

KOKUYO Group Code of
Conduct

integrity
102-17

Mechanisms for advice andSecurities Report p15

concerns about ethics(Japanese)（1.39MB）

Basic Concepts of CSR○

102-18Governance structure
Corporate Governance102-19Delegating authority
Executive-level responsibility

102-20for economic, environmental,
and social topics
Consulting stakeholders on

102-21

economic, environmental,
and social topics

4.
Governance

Composition of the highest
102-22governance body and its
committees

102-23102-24102-25

Securities Report p32(Japanese)（1.39MB）

Chair of the highest

Securities Report p32

governance body

(Japanese)（1.39MB）

Nominating and selecting thehighest governance body
Conflicts of interest
Role of highest governance102-26

body in setting purpose,values, and strategy

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KOKUYO s CSR

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Environmental Conservation

Corporate Activities

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Description

Core
QuestionsStandards

102-27

Customers

GRI Standards Questions

Page

Collective knowledge ofhighest governance body
Evaluating the highest

102-28governance body's
performance
Identifying and managing

102-29economic, environmental,
and social impacts

102-30

Securities Report p15, 32(Japanese)（1.39MB）

Effectiveness of risk
management processes
Review of economic,

102-31environmental, and social
topics102-32102-33102-34102-35102-36102-37102-38Highest governance body'srole in sustainability reporting
Communicating criticalconcerns
Nature and total number ofcritical concerns

Remuneration policies

Securities Report p33(Japanese)（1.39MB）

Process for determining

Securities Report p33

remuneration(Japanese)

Stakeholders' involvement inSecurities Report p33

remuneration(Japanese)（1.39MB）（1.39MB）

Annual total compensation
ratio
Percentage increase in

102-39annual total compensation
ratio

5.

○

102-40○102-41

Stakeholder
engagement

List of stakeholder groups

With Stakeholders

Collective bargaining

Securities Report p8

agreements(Japanese)

18（1.39MB）

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KOKUYO Group History

KOKUYO s CSR

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Description

Core
Questions○Standards

102-42Customers

GRI Standards Questions

Identifying and selecting
stakeholders

Page

With Stakeholders

With Stakeholders
5.
Stakeholder○

102-43

engagement

Approach to stakeholder
engagement

Dialogue with ourCustomers
CSR Report 2017 Survey
Results○

102-44○102-45

Key topics and concerns

CSR Report 2017 Survey

raisedResults

Entities included in the
consolidated financial

KOKUYO Group

statements

6.
ReportDefining report content and○102-46○102-47

List of material topics○

102-48

Restatements of information○

102-49Changes in reporting○

102-50

Reporting period○

102-51

Date of most recent report○102-52

Reporting cycle○

102-53

topic Boundaries

Contact point for questions
regarding the report

CSR Report 2017（11.0MB）
CSR Report 2017（11.0MB）
CSR Report 2017（11.0MB）
For questions regarding thereport, please contact
below.

Claims of reporting in○

102-54

accordance with the GRI
Standards○

102-55

GRI content index○

102-56External assurance

19

Content Index
Environmental Management
and Third-party Inspection

KOKUYO Group CSR Report 2018

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KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Description

Core
QuestionsStandards

GRI Standards Questions

Customers

Page

103: Management Approach

103-1

103-2

103-3

Explanation of the material
topic and its Boundary
The management approachand its components
Evaluation of the
management approach

Material topics
200: Economic

201-1

Direct economic value
generated and distributed

Earnings Highlights

Financial implications and201-2other risks and opportunities
due to climate change

201:
Economic
Performance

Defined benefit plan
201-3

obligations and otherretirement plans

201-4

Environmental Management
and Third-party Inspection

Financial assistance received
from government
Ratios of standard entry level

202-1

wage by gender compared to
local minimum wage

202:
Market Presence

Proportion of senior
202-2

management hired from thelocal community

203:

203-1

Infrastructure investments
and services supported

Indirect Economic
Impacts

203-2

204:
Procurement
Practices204-1

Significant indirect economic
impacts

Proportion of spending on
local suppliers

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KOKUYO Group History

KOKUYO s CSR

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Environmental Conservation

Corporate Activities

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Third-Party Assessments

Description

Core
QuestionsStandards

205-1

205:
Anti-corruption

Page

Operations assessed for risks
related to corruption
Communication and training

205-2

about anti-corruption policies
and process

205-3

206:
Anti-competitive

GRI Standards Questions

Customers

Confirmed incidents ofcorruption and actions taken
Legal actions for anti-

206-1

Behavior

competitive behavior, antitrust, and monopoly practices

300: Environment

301-1

301:
Materials

301-2

301-3

302-1

302-2

302:

302-3

Materials used by weight orEnvironmental Performance

volumeData

Recycled input materials

Environmental Performance

used

Data

Reclaimed products and theirpackaging materials
Energy consumption within

Environmental Performancethe organization

Data

Energy consumption outside

Environmental Performanceof the organization

Data

Energy intensity

Energy302-4

Environmental Performance
Data

Reduction of energy

Environmental Performance

consumption

Data

Reductions in energy
302-5

requirements of products andservices

303-1

303:
Water

Water withdrawal by source

Reports by Business Site

Water sources significantly
303-2

affected by withdrawal of
water

303-3

Water recycled and reused

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KOKUYO Group History

KOKUYO s CSR

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Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Description

Core
QuestionsStandards

GRI Standards Questions

Operational sites owned,
leased, managed in, or
304-1

Customers

Page

Yui no Moriadjacent to, protected areas
and areas of high biodiversity
value outside protected areas

ReEDEN ProjectSignificant impacts of
304:

304-2

activities, products, andservices on biodiversity

Biodiversity
304-3

Habitats protected or restored

Yui no Mori

IUCN Red List species and304-4

national conservation list
species with habitats in areas
affected by operations

305-1

305-2

305-3

305:

Direct (Scope 1) GHG

Environmental Performanceemissions

Data

Energy indirect (Scope 2)

Environmental Performance

GHG emissions

Data

Other indirect (Scope 3) GHG

Environmental Performanceemissions

Data

305-4

GHG emissions intensity

305-5

Reduction of GHG emissions

Emissions

305-6

306:
Effluents and

306-2

Environmental PerformanceData

substances (ODS)

oxides (SOX), and othersignificant air emissions

306-1

Data

Emissions of ozone-depleting

Nitrogen oxides (NOX), sulfur
305-7

Environmental Performance

Water discharge by qualityand destination

Environmental Performance
Data

Reports by Business Site

Waste by type and disposal

Environmental Performance

method

Data

Waste
306-3

Significant spills

306-4

Transport of hazardous waste

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KOKUYO Group History

KOKUYO s CSR

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

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Description

Core
QuestionsStandards

GRI Standards Questions

Page

Water bodies affected by306:
Effluents andCustomers

306-5

water discharges and/or

Waste

runoff307:

Non-compliance with

Compliance with the law

environmental laws andand the prevention ofregulations

pollution

Environmental

307-1

ComplianceNew suppliers that were
308:

308-1

environmental criteria

Supplier
Environmental
Assessment

screened using

Negative environmental
308-2

impacts in the supply chain
and actions taken

400: Social

401-1

employee turnover

CSR Data: Society

Benefits provided to full-time

401:
Employment

New employee hires and

401-2

employees that are notprovided to temporary or parttime employees

401-3
402:
Labor/Management

Parental leave

CSR Data: Society

Minimum notice periods
402-1

Relationsregarding operationalchangesWorkers representation in

403-1

formal joint management-

Securities Report p8

worker health and safety(Japanese)（1.39MB）

committees
Types of injury and rates of
injury, occupational diseases,
403:

403-2

lost days, and absenteeism,

Occupationaland number of work-related

Health and Safety

fatalities

CSR Data: Society

Workers with high incidence
403-3

or high risk of diseases
related to their occupation
Health and safety topics

403-4

covered in formal agreementswith trade unions
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Corporate Proﬁle

KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Description

Core
QuestionsStandards

404-1

GRI Standards Questions

404-2

year per employee

employee skills and transition
assistance programs

Training andPage

Average hours of training per

Programs for upgrading
404:

Customers

Human Resource
Development Program

Education
Percentage of employees
404-3

receiving regularperformance and careerdevelopment reviews

405-1
405:
Diversity andEqual Opportunity

Diversity of governancebodies and employees

CSR Data: Society

Ratio of basic salary and405-2

remuneration of women to
men

406:
Non-discrimination

406-1

407:
407-1

CollectiveChild Labor

408-1

Security Practices

Operations and suppliers at
409-1

Indigenous

Human Rights
Assessment

With Business Partners:
Basic Concepts

With Business Partners:
Basic Concepts

Security personnel trained in
410-1

human rights policies orprocedures

Incidents of violations
411-1

involving rights of indigenous
peoples

Peoples412:

significant risk for incidents offorced or compulsory labor

411:
Rights ofsignificant risk for incidents ofchild labor

Compulsory Labor

410:

association and collective

Operations and suppliers at

409:
Forced or

which the right to freedom ofbargaining may be at risk

Bargaining

408:

and corrective actions taken

Operations and suppliers in

Freedom of
Association and

Incidents of discrimination

412-1

Operations that have been
subject to human rights
reviews or impact
assessments
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KOKUYO Group History

KOKUYO s CSR

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Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Description

Core
QuestionsStandards

412-2

Customers

GRI Standards Questions

Page

Employee training on humanrights policies or procedures
Significant investment
agreements and contracts

412-3

that include human rights
clauses or that underwent
human rights screening

Operations with local
413-1
413:

community engagement,
impact assessments, anddevelopment programs

Local

Domestic contribution
activities
Foreign contribution
activities

Communities
Operations with significant
413-2

actual and potential negative
impacts on local communities

414-1
414:
Supplier Social
Assessment

New suppliers that werescreened using social criteria
Negative social impacts in the

414-2

supply chain and actions
taken

415:
Public Policy

415-1

With Business Partners:
Basic Concepts

Political contributions

Quality Assurance at
KOKUYO Stationery
Assessment of the health and
416-1
416:

safety impacts of product andQuality Assurance atservice categories

KOKUYO Furniture

Customer Health

Kaunet Quality Assurance

and Safety
Incidents of non-compliance416-2

concerning the health andsafety impacts of products
and services

417:
Marketing andLabeling

Requirements for product and
417-1

service information andlabeling

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Corporate Activities

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Description

Core
QuestionsStandards

GRI Standards Questions

Customers

Page

Incidents of non-compliance
417-2
417:

concerning product andservice information andlabeling

Marketing andLabeling

Incidents of non-compliance
417-3

concerning marketing
communications
Substantiated complaints

418:
Customer Privacy

418-1

regarding concerning
breaches of customer privacy
and losses of customer data

419:
Socioeconomic
ComplianceNon-compliance with laws
419-1

and regulations in the socialand economic area

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KOKUYO s Three Business Areas

KOKUYO Group History

KOKUYO s CSR

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Regional Communities

Environmental Conservation

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ISO26000
Information about issues concerning the following core subjects of ISO26000 can be viewed in the following sections of
this CSR report.
ISO26000 Core

IssuesSubjects

Page

Message from the President
Organizational
governance

Issue 1: Organizational governance

CSR Management
Corporate Governance and Risk
Management
CSR Management: Basic Concepts
KOKUYO's CSR Charter

Issue 1: Due diligence

KOKUYO Group Code of Conduct

Issue 2: Human rights risk situations

System Linking Company’s Growth

Issue 3: Avoidance of complicity

with Individual Growth

Issue 4: Resolving grievances
Human rights

Issue 5: Discrimination and vulnerable
groupsWork Style Reform
Human Resource Development
Employees’ Safety and Health

Issue 6: Civil and political rights
Issue 7: Economic, social and cultural rights

Respect for Human Rights

Issue 8: Fundamental principles and rights at

Basic Framework for Diversity

workWith Business Partners: Basic
Concepts
CSR Data: Society
KOKUYO's CSR Charter
KOKUYO Group Code of Conduct

Issue 1: Employment and employment

Labor practices

System Linking Company’s Growth

relationships

with Individual Growth

Issue 2: Conditions of work and social

Work Style Reform

protection

Human Resource Development

Issue 3: Social dialogue

Employees’ Safety and Health

Issue 4: Health and safety at work

Respect for Human Rights

Issue 5: Human development and training in

Basic Framework for Diversity

the workplace

With Business Partners: Basic
Concepts
CSR Data: Society
CSR Management: Basic Concepts
KOKUYO's CSR Charter

Issue 1: Prevention of pollution

KOKUYO Group Code of Conduct

Issue 2: Sustainable resource use
Issue 3: Climate change mitigation andEnvironment

With Business Partners: Basic

adaptation

Concepts

Issue 4: Protection of the environment,

Environmental Management andbiodiversity and restoration of natural

Third-party Inspection

habitats

Global Warming Preventive Measures
Resource-saving and Recycling
Measures27

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KOKUYO Group History

KOKUYO s CSR

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Regional Communities

Environmental Conservation

Corporate Activities

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Third-Party Assessments

Compliance with the law and theprevention of pollution
Developing Environmentally-friendly
Products and Services
Biodiversity/Promoting Environmental

Environment

Communications
Environmental Performance Data
Reports by Business Site
Yui no Mori
Eco-Batsu Activities
CSR Management: Basic Concepts

Fair operating
practices

Issue 1: Anti-corruption

System for the Promotion of CSR

Issue 2: Responsible political involvement

KOKUYO's CSR Charter

Issue 3: Fair competition

KOKUYO Group Code of Conduct

Issue 4: Promoting social responsibility in theWith Business Partners: Basicvalue chain

Concepts

Issue 5: Respect for property rights

Corporate Governance and Risk
Management

Issue 1: Fair marketing, factual and unbiased
information and fair contractual practices

ConsumerissuesIssue 2: Protecting consumers' health and

KOKUYO's CSR ChartersafetyProviding Peace of Mind and Safety toIssue 3: Sustainable consumption

Customers

Issue 4: Consumer service, support, andCSR Report 2017 Survey Resultscomplaint and dispute resolution

CSR Data: Reflecting the views ofIssue 5: Consumer data protection andcustomers

privacy

Eco-Batsu Activities

Issue 6: Access to essential services
Issue 7: Education and awareness
KOKUYO's CSR Charter

Community
involvement
anddevelopment

Issue 1: Community involvement

KOKUYO Group Code of Conduct

Issue 2: Education and culture

New Products and Services in 2017

Issue 3: Employment creation and skills

Human Resource Development

development

Domestic contribution activities

Issue 4: Technology development andForeign contribution activities

accessCommendation and Recognitions from

Issue 5: Wealth and income creation

OutsideIssue 6: Health

Biodiversity/Promoting Environmental

Issue 7: Social investment

Communications
CSR Data: Society

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Customers

The KOKUYO Group strives to maintain and improve quality in order to ensure that customers can use our products
safely and securely. As the ratio of overseas production such as in Asia increases, we work closely with overseas
production factories, pass on production technology and know-how, and share and thoroughly implement our quality
standards.

Quality Assurance at KOKUYO Stationery
In order to deliver quality that our customers can trust, we have taken steps to systematically build, operate and improve
our systems for quality assurance.

Quality Maintenance and Improvement
1) Deepening the Quality Assurance System
KOKUYO has re-examined design review and safety review, which areimportant processes for the quality, and production trial observation as wellas guidelines for chemical management to work out the details of thecontents to reflect the times. Those efforts have been utilized for theeducation of young and new employees and promoted for use as a bible for
employees involved in quality control, aiming to deepen the quality
assurance system.
In addition, by introducing product risk evaluation methods andimplementing risk countermeasures, we strive to enable our customers touse our products with confidence.
Introduction of robots in quality testing2) Establishment of the inspection system on a global basis
KOKUYO has established an inspection skill evaluation method with global standards, which evaluates the skill level ofinspectors around the world and sets up a system for education and guidance with the aim of maintaining a certain levelof inspection skills. In addition, we provide necessary paraphernalia and manuals for inspection globally to maintain thelevel of inspection at a certain level, thereby increasing the accuracy of discovering faulty products during inspection toprevent the outflow of faulty products.

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3) Increasing the speed and accuracy of handling complaints
In addition to safety, people around the world are seeking a sense of reassurance and now anybody can receive andtransmit large amounts of information anytime. As we consider it to be essential to further increase the accuracy andspeed of handling customer complains in the future, we have embarked on visualizing and standardizing the processes,
information for making decisions, and evaluation criteria of the course of actions that corporations should take when
product risk occurs. This will ensure the unification of decision-making process procedures within the organization andminimize the variation of determination, as well as to speed up the process.
4) Enhancement of value evaluation testing in addition to quality verification testing
While we thoroughly implement quality verification testing at the time of the renewal of existing products anddevelopment of new products, we make continuous efforts to maintain and improve testing quality by introducing robots.
Additionally, to respond to the various needs of users, we have been working to conventionally confirm quality to see
whether products are sturdy and offered at a low price and to quantify the quality to ensure that valuable and attractive
products are offered to customers.

Quality Assurance at KOKUYO Furniture
The KOKUYO Furniture business has acquired ISO 9001Quality Management System certification. Based on this, weare developing and thoroughly implementing process procedures covering product planning, design, production, andinstallation. Moreover, each department related to production, delivery and installation takes actions for improvement
each day, and the opinions and requests from customers are used to improve overall quality.

Enabling Customers to Use KOKUYO Products with Confidence
1) Setting High In-House Standards
In the process of developing new products, we conduct multi-faceted evaluations to ensure ease of use and safety. In
the production phase, we ensure compliance with the Japanese Industrial Standards (JIS) and other industry standards,
as well as our even more demanding in-house standards.
2) Responding when Failures Occur
Should a product fail while being used by a customer, that information is shared among all related departments toprovide a fast response. In this process, we identify the cause of the problem and incorporate corrective measures into
the product and its manufacturing process in order to prevent recurrences of similar failures. If a serious accident
occurs, the Compliance Committee determines the policy to be followed, reports the issue to the relevant government
authorities, and notifies the public through newspapers and websites to limit the extent of any damage.
3) Notifications Regarding Product Safety and Quality
KOKUYO Furniture uses its corporate website as a medium for making
notifications regarding product safety and quality. The most-appropriate oneof the following four sections of the website is selected, depending on thenature of the notifications.
1. Important notice regarding product safety
2. Important notice regarding defective quality
3. Announcement regarding the safety and proper use of a product
4. Other announcement regarding product safety and quality

Web page for KOKUYO FURNITURE
Co.,Ltd.
Notifications Regarding Product Safety andQuality4) Full Set of Quality Improvement Initiatives for the Total Process through to Delivery
In selling furniture, our company's responsibility is also to deliver our products to customers' offices and make themready for use. For this reason, we strive to continuously improve quality not only in our manufacturing processes, but
30

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also in shipment and delivery. We provide training on product assembly techniques and customer service manners to
the partner companies subcontracted to deliver our products. We also hold a nationwide contest every year to judge theabilities in product assembly and customer service. Through these activities, we are raising the awareness level ofdelivery personnel, with the goal of achieving continuous quality improvement.

KOKUYO Logitem, the company responsible for distribution,
has conducted a web-based customer survey twice a year since2012 on the quality of delivery. The feedback received from
customers through the survey is delivered to partner companies
and delivery centers operating on the front lines of productdelivery. Based on favorable comments received from
customers, we select drivers who have met the various
selection criteria for work leading to added value in delivery, andshow our gratitude by handing letters of appreciation containing
heartfelt comments directly to the drivers. We continue to sharecustomers' frank opinions with field personnel to further

In-house voting to pick the winners of the
Most Heartfelt Comment Award and theAward for Largest Number of Heartfelt
Comments

motivate the drivers and improve delivery quality.

Kaunet Quality Assurance
Kaunet handles an array of products from stationery, office supplies such as copy papers to beverages, food, electric
appliances, gifts, medical related products, store operation products, made-to-order products including business cards
and stamps, and office furniture from 1,000 manufacturers. As a distributor, Kaunet has been making efforts to work
together in the value chain and improve not only the quality of the line of goods but also the customer service at callcenters and delivery to offer a sense of security and safety to customers.

For Product Deliveries (Main Services)
1) Same-day, next-day delivery services (Except for certain products andservices)
Except in Okinawa Prefecture, remote islands and some hilly andmountainous areas, Kaunet delivers orders the next day if orders are placed
before 6 p.m.
Same-day delivery areas may receive the order on the same day if an orderis placed before 11 a.m.
2) Promotion of simple packaging
For deliveries of products in paperboard boxes, which is the most common

Our efforts on simple packaging

packaging, Kaunet exercises its ingenuity in using cushioning materials for protecting products as little as possible. For
imperious products in a lower volume, the orders are delivered using simple packaging, such as paper bags orpolyethylene bags to conserve resources.

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Third-Party Assessments

3) The services for selecting packaging of delivery (For online orders only)
While customers highly appreciate the delivery using simple packaging, Kaunet also responds to the request for delivery
using boxes to accommodate occasions when sending orders to business partners or as a gift. When placing an order,
customers can select the packaging form each time.
4) Furniture delivery with assembly services
Delivery staff specializing in furniture offer delivery, unpacking, assembling, and installation to packing material collection
for the delivery of large furniture, heavy furniture, and those requiring complicated assembly.

Collection services
Kaunet promotes resource conservation and recycling outdated Kaunet catalogues and cardboards for shipping, as wellas the collection services for used toner cartridges.

Office Activities in Countermeasures for Disasters

1) Developing a menu of countermeasures against earthquakes for officeSince the Great Hanshin Earthquake, we have carried out verification of earthquake
countermeasures for offices. However, we recognized that there were still issues of officesafety and security as we supported the restoration of our customers' offices after the Great
East Japan Earthquake. There was also a sudden increase in consultations about
earthquake countermeasures after the earthquake, and we even received many inquiries andrequests that we were unable to answer with the vibration verification experiments we had
performed.
With these experiences and consultations in mind, we carried out a wide range of verification
experiments so that we could suggest further earthquake countermeasures. Based on thelarge amount of data obtained from these experiments, we determined the relationshipbetween seismic waves and earthquake preparedness rationally to devise objective evaluation criteria for earthquakeresistant furniture. We thus propose a menu of earthquake countermeasures for offices, catering to the level and cost of
countermeasures that our customers desire.
※ Related information: Menu of Countermeasures Against Earthquakes for Office2) Developing a menu for introducing and utilizing emergency supplies best-suited to offices
KOKUYO is operating a disaster solution business to provide emergency supplies essential
in the process of building an organization's BCP, as well as the expertise necessary for
introducing and operating them. Using primarily the SONAeL, a guidebook on emergency
supplies, and the PARTS-FIT, a disaster countermeasure series for both normal states andduring emergencies, we are assisting our customers in simultaneously achieving a
comfortable working environment and emergency preparedness.

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PARTS-FIT

Customers

elecabi
Emergency supplies cabinet for elevators

3) Raising the level of awareness
KOKUYO is working aggressively to raise awareness of the need to beprepared for disasters. These include holding seminars around Japan on thetheme of earthquake countermeasures for offices. Subjects covered in theseseminars included the difficulties faced by management immediately after
the Earthquake (using KOKUYO Tohoku Sales Co., Ltd., as an example),the continuous development of the selection-distribution-managementrenewal cycle as companies move from the "stockpiling" stage to the"continue to stockpile" stage 7 years after the earthquake as a measure to
stockpile emergency supplies from the perspective of business continuity
planning (BCP), and the creation of offices that can withstand strong

Seminars on disaster countermeasures forcorporationcorporations

earthquakes (KOKUYO Furniture).

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Customers

KOKUYO Group values dialogue with customers. We sincerely accept opinions, requests, and suggestions from
customers we receive on various occasions and strive to use these to develop and improve our products and services,and to improve customer satisfaction.

Kaunet Factory, an Interactive Furniture Showroom, Opens

Kaunet Co., Ltd., which sells office products online and byfax, opened the Kaunet Factory, a furniture showroom, on
the first floor of its headquarters building (located in Kamata,Ohta-ku, Tokyo). The Kaunet Factory addresses the recently
increasing number of layout inquiries resulting from moving
or remodeling small and medium-sized offices. This
interactive showroom allows customers to not only check out
actual products, but also view furniture pieces and design
Kaunet Factory floor plan
their layout on the spot. The showroom is composed of thefollowing sections:●Office chair area
Customers can select the size and level of support they prefer and then experience comfortable office chairs best
suited to them.
●Desk area
Customers can select the ideal desk according to their intended use and available space, and experience the widthand depth of the top board. They can also try out various options designed to improve work efficiency.
●Simulation area
Drawings and numbers cannot easily convey the actual feel of a workspace. In this area, one of our consultants
can assist the customer in creating a simulated layout of the customer's work space using actual products.
●Consultation area
Office furniture professionals not only respond to customer's requests, but also point out potential problems andissues customers might not easily realize on their own. Furthermore, for customers using the simulated officelayout service, immediately after the customer tries out various products, the drawing is corrected on the spot toincorporate any changes on a real-time basis and the customer can confirm the changes on 3D images.
Kaunet uses the information it obtains through direct communication with customers using these platforms andlistening to their frank opinions, to develop future products and provide better services.
※ For details, please visit→the Kaunet Factory webpage.

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A System for Utilizing Feedback from Customers
In order to share customer feedback across the entire group, we use the intranet, VoiceClip, to share feedback ofcustomers with all of our group employees (customer personal information is excluded beforehand). Both angry complaints
and words of appreciation from customers are updated weekly on VoiceClip. Since 2012, we have been working to improvevisualization by displaying customer feedback on the top page of the Group's intranet. Additionally, the customer feedback
submitted to the customer support center is summarized in a database (personal information excluded), VoiceDB, so thatGroup employees can access the database to freely navigate through previous feedback as needed.

Soft Ring® Notebooks and Memo Pads <Colorful> (dotted ruled lines) (perforated)
In March 2015, KOKUYO launched the Soft Ring® notebook (inSemi B5 and A5 sizes), which is bound with "Soft Rings" madefrom a resin that do not interfere with writing.
Since its launch, this novel notebook achieved cumulative sales ofover 5 million units by the end of September 2017.
Many of the customers who purchased Soft Ring® notebooks
indicated that they would also like to have a pocket-size version
that would be easy to carry and handy for taking notes.
As this customer request matched the wish of the department incharge to expand the Soft Ring® notebook product line-up, aSoft Ring® notebook and memo pad product line-up

memo pad in a modified A7 size and notebooks in B6 and A6
sizes were launched in November 2017.

Soft Ring® memo pad in use

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Regional Communities

Environmental Conservation

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Dialogues with our Customers
The internal structure of the Customer Support Center was changed.
In November, the structure of the Customer Support Center was significantly changed. Under the new structure, thesupport person who receives a customer inquiry is required to see to it that the inquiry is fully addressed to a satisfactory
conclusion. This requires each support person to possess ample product knowledge and the ability to understand andsolve the customer's true issue. Therefore, a new team was formed to support and enhance these efforts so that theentire customer support organization could work together to solve customer issues. Meanwhile, a new team forcollecting and analyzing customer opinions was also formed, with the collected information being utilized in products
and services as well as to provide improved services to customers.
The goal of the KOKUYO Customer Support Center is to provide customers with KOKUYO-style useful support while
flexibly coping with societal changes.

Kaunet Holds First-ever Exposition "Kaunet Festival"
With the goal of increasing the convenience and member benefitsof Kaunet, our web- and FAX-based office product sales site, afirst-ever exposition "Kaunet Festival" was held on December 14,
2017. Thirteen suppliers, including KOKUYO Stationary Business
Division, co-sponsored the event, helping to make it more festive.
At the festival, our employees promoted the benefits of Kaunet
services, centered on Kaukore products (Kaunet original
products), directly to visitors and conveyed KOKUYO's approach.
We believe that the event enabled visitors to experience Kaunet's
appeal firsthand. We will utilize the valuable opinions received
from customers for future service improvement.

Event venue crowded with many visitors immediately
following the opening

Creating Model Office for "Reforming People's Work Style" through Collaboration with Customers
The Chugoku branch of KOKUYO Marketing

Co., Ltd. received aletter of appreciation from NTT Facilities Inc. Chugoku Branch for
its contribution in building a model office that supports the conceptof "Reforming People's Work Style" that NTT Facilities is aiming toachieve. The recent remodeling was positioned as a model officeof Reforming People's Work Style that can actually be
experienced by customers. It can be said that the collaboration
between NTT Facilities, an expert in facility making, and
KOKUYO, an expert in office making, was the major factor insuccessfully creating the first innovative new office in the country.
The office received the Thirtieth Nikkei New Office Awards (2017)

The completed model office. In the future, the two- Chugoku Region Block New Office Promotion Award (Award

companies will work together to make suggestions on
various issues such as "Reforming People's Work

given by the Director-General of the Chugoku Bureau of

Style", while utilizing their respective offices.

Economy, Trade and Industry).

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Interview Training Based on New Skill Indexes
Based on the New Skill Indexes revised in FY2016, we conducted interview training in 2017. The training included acourse on understanding the importance of comprehending customers' true needs and providing solutions that exceed
customer expectations, as well as a practical skills seminar to enhance listening skills to draw out customer profiles andusage scenarios so that these solutions can be provided. The course described case studies in which listening resulted
in solutions that exceeded customer expectations, as well as in-house initiatives to develop new products or improve
products based on customer feedback. In the practical skills seminar, operators were divided into pairs and trained inlistening skills using role play.
Another goal of the KOKUYO Customer Support Center is to provide customers with KOKUYO-style useful support byunderstanding their true needs and striving to provide solutions that exceed customer expectations.

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January 30th, 2017

March 13th, 2017

Stationery business

Other

File series "MOTTE" designed

Book "Secrets to Preparing an

for women launched

Information Packet that Will Get You
Instant Approval" Published

April 19th. 2017

July 3rd, 2017

Stationery business

Stationery business

New Standard Filing Series

New Series "KaTaSu" Useful for"NEOS" Launched

Sorting and Utilizing Personal
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August 9th, 2017

August 9th, 2017

Stationery business

Customers

Mail-order Business / Retailing"Hakoake" Scissors that Can be

Interactive Furniture Showroom

Used like a Box Cutter Launched"Kaunet Factory" Opened

September 27th, 2017

October 27th, 2017

Stationery business

Other

New Customizable Ballpoint Pen

Book "KOKUYO's Simple Organizing Techniques""Eraberuno" Debuts

Launched

November 6th, 2017

November 6th, 2017

Furniture business

Personal Locker "iNON" Launched

Furniture business

Conference Room Chair "Spline"
Launched

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November 6th, 2017

November 6th, 2017

Furniture business

Customers

Furniture business

Conference Room Table "CALM"

Five Office Lounge Furniture

Launched

Products Launched

November 7th, 2017

December 18th, 2017

Furniture business

Stationery business

Innovative Chair "ing" Launched that

Limited Number of "Biwacomic"

Changes the Concept of Sitting

Notebooks Launched40

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Regional Communities

The 15th KOKUYO Design Award 2017 with "New Story" ThemeThe KOKUYO Design Award is a design competition thataims to attract product designs for commercialization from a
broad range of general users, bringing forward products thatare superior from a user's perspective. The Award marked
its 15th year in 2017. Examples of products commercializedbased on past entries include the True Measure, winner of a
Merit Award in 2014, and the Manga Packing Tape, winner ofa Merit Award in 2016, both of which were launchedcommercially in 2017. The themes of the Design Award inrecent years have included not only practicality and beauty
in design, but also suggestions on ways of living andlifestyle, such as "Beautiful Living" (2015) and "How to Live"(2016). This year, moving beyond this orientation, we were
hoping for fresh entries capable of establishing new genres

The KOKUYO Design Award exhibit at the Bunshi
Messe 2017, displaying models of all entries that won
the Grand Prix and Merit Awards between 2011 and2016

in working, learning, and living in the age of material
overabundance. This is why "New Story" was chosen as the theme. A total of 1,326 entries (880 from Japan and
446 from overseas) were received.
As an advance event, an open discussion was held on July 26, featuring KOKUYO Design Award judges Mr.
Ryosuke Uehara and Ms. Yoshie Watanabe of KIGI, and Ms. Ryuko Kida of the Elle Decor magazine, as well as
KOKUYO President Hidekuni Kuroda. The participants held a lively discussion about "New Story", while
introducing various entries from Japan and around the world answering the question, "What is your new story?"
Then, on August 8 and 9, the KOKUYO Design Award Story 2011-2016 Exhibit was held inside the Bunshi Messe,
one of the largest stationery events in Japan, adding excitement to the KOKUYO Design Award 2017.
The four winning entries were selected on January 18, 2018. The Grand Prix went to Eatool (designed by Daisuke
Kakinoki, Haruka Mitani, and Yuki Yawata) of nyokki.
* For details, please visit→the KOKUYO Design Award website.

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KOKUYO Original Pocket Notebook Provided in Sponsorship of J. League Division 2
Soccer Team, JEF United Chiba
In order to deepen its relationship with the JR East Japan Group,
the Furniture Business Division is co-sponsoring JEF United
Chiba, a professional soccer team that plays in Japan's J. League
Division 2. To provide KOKUYO-style sponsorship, the Furniture
Business Division obtained the cooperation of the Stationery
Business Division to create and provide a field notebook*engraved with the 2017 team slogan "Pasion - Fight with All Our
Might." ("Pasion" means passion in Spanish.)People from the Furniture Business Division and the
JEF team. Shown on the right is the field notebook

As a symbol for the players, fans, and team officials to work

recently provided.

together throughout the season toward promotion to Division 1, the notebook was given out to the first 1,200 spectators
arriving at the season's opening game (J. League Division 2, Section 2) played against Montedio Yamagata at JEF
United Chiba's home stadium on March 4, 2017.
*A long-term favorite pocket notebook launched in 1959. Although it was originally designed for recording surveying results out in the field, it
is now being used in a variety of applications, such as taking notes outdoors and in everyday life, because of its ease of use outdoors.

Lecture at the Fourth Smart Sound Design Society Symposium
On March 3, World Hearing Day, Yukinobu Iwakiri of KOKUYOEngineering & Technology Co., Ltd. (KET) gave a lecture at the
Fourth SSDS Symposium hosted by the Smart Sound Design
Society (SSDS)*.
Entitled, "Diversifying work styles and what future offices will
require," the lecture introduced office sound environments andsound solutions KOKUYO has in mind. It provided an excellent
opportunity for attendees to learn about the activities of KET,
which utilizes sound technology to support office worker
productivity improvement and contribute toward work style reform.
Furthermore, the symposium resulted in networking among

Panel discussion after the lecturesprofessionals in a variety of sound-related fields, which may leadto promising new advances in sound solutions.
* An organization established with the goal of promoting and popularizing sound design (which uses sound to aurally generate a sense of
beauty or improve functioning) and building comfortable and functional sound environments.

KOKUYO-Sponsored Nishinomiya Storks Wins the B2 League Championship
KOKUYO Marketing Co., Ltd. signed an official sponsorshipcontract with the Nishinomiya Storks, a professional basketballteam in Nishinomiya City, Hyogo Prefecture, with the goal ofcontributing to the community and creating a local culture thatenhances the ability to unite. In the first B2 League championshipgame held on May 20, 2017, the Nishinomiya Storks won 78-53
over the powerful team, Shimane Susanoo Magic, becoming thefirst champions of the B2 League.
On May 25, the Nishinomiya Storks players visited the Umeda
Office to thank KOKUYO Marketing for its support and report the
team's promotion to the B1 League. Through continued support ofNishinomiya Storks players who came to visit the

the Nishinomiya Storks, KOKUYO Marketing plans to keep

Umeda Office

making a contribution to the local community.
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Third-Party Assessments

Presenting Improvement Activities at the All-Japan Convention for Logistics Improvement
Case Studies
On May 16 and 17, 2017, the All-Japan Convention for Logistics
Improvement Case Studies was held, hosted by the Japan
Institute of Logistics Systems. The goal of the Convention is tobroaden participants' view and promote future logistics
rationalization activities by sharing excellent improvement casestudies and expertise from logistics sites. From the KOKUYOGroup, KOKUYO Supply Logistics Co., Ltd. (KSL) participated in
the Convention as it had the previous year.
At the 2017 convention, which was the 31st, outstanding
improvement cases at 30 companies selected from all over Japan
were presented. KSL reported on improvement resulting fromcollaboration with intra-warehouse partners that went beyond

Presentation under the theme of "We should have done
that! Ways of coping with environmental change"

company boundaries inside a warehouse. By having our company's improvement appreciated by others and having an
opportunity to incorporate other companies' improvement examples, we are aiming to further improve our abilities inlogistics operations.

Summer Vacation KOKUYO Logistics Center Tour for Parents and Children Held
In 2017, KOKUYO Supply Logistics Metropolitan Area IDC,
repeated the popular Summer Vacation KOKUYO Logistics
Center Tour for Parents and Children it had held in 2016. This
year the event was hosted jointly by Okumoto Irohado K.K., aretailer, and KOKUYO Marketing with the goal of helping children
learn about and feel more familiar with KOKUYO by having themtour and experience KOKUYO's logistics operations. Despite rainy
weather on the day of the event, 21 people (12 elementary school
students and 9 guardians) participated in the event.
Our hope is that the recent experience will help the participants
become more interested in the stationery they casually use every

The children experienced picking operations inside theday, and become true KOKUYO fans.

warehouse and operations involving the inspection
tablet introduced in May

KOKUYO Supply Logistics Chubu IDC Interviewed by Local Elementary and Middle School Students
KOKUYO Supply Logistics Chubu IDC, which performs logistics
services, was featured in the "PR Komaki," a PR brochure of its
hometown, Komaki City. This was part of a project in which fifthand sixth graders and middle school students in Komaki City visit
interesting places and companies, and publish articles createdfrom interviews and photos in a PR brochure. In addition to being
featured in the PR brochure, the article was also posted atelementary schools within the city. On the day of the visit, IDC
personnel took some creative steps, for example incorporating aquiz into their overview explanation, to help the students
understand logistics operations in a fun way.
Through these activities, we hope to not only provide children withChildren experiencing picking and sorting operations for
KOKUYO products during a tour

work experience, but also convey the appeal of Chubu IDC to as many Komaki City residents as possible.

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Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Calendar Featuring Letter-shaped Chairs and Beautiful Japanese Scenery
The HELLO Chairs were born out of the KOKUYO Design Award. By combining letter-shaped chairs to write a message
in space, these chairs are designed to allow people to communicate using chairs.
The Furniture Business Division worked on the KOKUYO Calendar Project, which photographs HELLO Chairs in areasof beautiful Japanese scenery. The photos were taken by Mr. Makoto Hada, a photographer who shoots a wide range ofobjects, from celebrities to scenery. The planning for the photo shoot, its design, and location negotiations were all doneby KOKUYO employees, rather than a design company. We plan to use this calendar broadly as a new tool for
conveying KOKUYO's appeal to customers.

HELLO CHAIR

January Mt. Fuji and the rising sun

March Beginning of a new life

Helping Revitalize Shopping Districts across Japan through the Isu-1 Grand Prix
The Isu-1 Grand Prix*, an office chair two-hour endurance race,
was again held in shopping districts across Japan in 2017. Each
year, KOKUYO teams are formed with KOKUYO product retailers
and agencies in various regions, helping to revitalize shopping
districts through race participation. In 2017, KOKUYOInternational (Malaysia) Sdn Hbd organized races in Malaysia andSingapore for the first time in the ASEAN.
In a new initiative, an official website was established offering aservice to rent "Isu-1 vehicles" to high school teams to involve
local young people. This service enables high school students, forwhom purchasing office chairs presents a financial obstacle, toeasily participate in the races, making them more exciting.

Newly established official website of
KOKUYO Isu-1 Racing

The Job Study Initiative
The Job Study is a cross-industry seminar held by a team of human resources personnel from leading companies invarious industries. They meet to discuss what kind of seminar is truly useful for students and use the results to organize
a seminar themselves. When it was first launched in 2005, the issue of early departure for newly hired college
graduates, where 30% leave their employment within three years, was a major issue. To address this issue and toprovide an opportunity for corporations and students to come together, we have brought about the realization of mutualcommunication where corporations and students can talk about the significance of working by planning a program on
the concept of real opinions and hand-made. Since then, 13 years have passed and we have continued to face students
with sincerity, and today, a total of 20 leading companies from various industries have joined the Job Study.
As of the end of 2017, the Job Study had amassed 13 years of positive results. At the 4th Career Education Awards, theJob Study received the Award for Encouragement for sharing philosophies regarding the broad range of challenges
students face just prior to entering the workforce by a wide variety of companies and flexibly dealing with thesechallenges. However, the environment surrounding students and companies, including economic fluctuations and thegraduate recruitment environment, is rapidly changing, and numerous issues still exist between job seekers andcompanies even in the current so-called seller's market. Against this backdrop, the Job Study is asking therepresentatives of the personnel departments of 20 participating companies to shun the status quo and come together
and seriously consider what is required and what they would like to do as they look to the future.
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I have the feeling that the number of new challenges facing
students, corporations and universities have increased andchanged because of the rapid changes of the graduate
recruitment environment in recent years.
Because it is an era when needs and difficulties havediversified, the program we hold is not standardized. We carryout programs thinking about who and what will benefit, as well

Hiroki Yamamotoas the schedule and contents.

KOKUYO HRBP Office

While KOKUYO as a single company can only do so much on its own, the 20 companies that comprise
this program are committed to joining forces to create new value and opportunities that others cannot
provide.

Tying the Environment, Welfare, and the Community Together with Photocopier Paper: theEco-Lab Heart Shiga Initiative
KOKUYO Marketing and KOKUYO Product Shiga are engaged ingreen purchasing activities and have been participating in the
Shiga Green Purchasing Network (Shiga GPN), a local network
program, since June 2006. The KOKUYO Group has been
involved since the beginning with the Eco-Lab Heart Shiga
initiative, which was developed by Shiga GPN's Research Society
for Green Purchasing Evaluation Techniques and is presently
operated by NPO Shiga Prefecture Social Employment Business
Promotion Center.
This initiative constitutes a system for requesting the use of plastic
boxes in place of cardboard boxes to deliver photocopier paper for

Delivery using a plastic box instead of a cardboard box

daily use to approximately 150 cooperative workshops within
Shiga Prefecture where disabled persons are employed. It was begun in 2007 with two aims: environmental (reducing
unnecessary packaging) and welfare (promoting and employing disabled persons). By using photocopier paper
manufactured at KOKUYO Product Shiga, a model consisting of elements based entirely in the local community is inplace.
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Regional Communities

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The Eco-Lab Heart Shiga initiative is highly regarded in terms of uniqueness, sustainability and development, and it won
the grand prize of the "13th Green Purchasing Award" in 2011. With the increase in participating corporations andorganizations, not only is there a reduction in rubbish, but also the income of the disabled people working in theworkshops can be improved through delivery of photocopier paper, other eco products and products made in theworkshops.
To companies and organizations with offices in Shiga Prefecture, would you like to participate in the original CSR
activities of Shiga Prefecture, the advanced prefecture in terms of environment and welfare?

Local Cleanup Activities and Blood Donation
The KOKUYO Group collaborates with local communities through cleanup activities carried out at office buildings,
plants, Distribution Centers, and overseas business offices. Cleanup activities are performed once a year around thehead office building in Osaka with the cooperation of the local government.
Through a tie-up with the organizers of the Osaka Marathon, Operation Osaka Marathon Cleanup has been organizedsince 2011 as a cleanup activity for all areas of Osaka so as to present a clean city to visitors to Osaka. The company
participated in this activity in collaboration with the local government.
At various sites around the country, our employees have participated in blood donation drives since 1980. In 2017, 33
employees donated blood on an occasion when the Japanese Red Cross Osaka Blood Center visited the company.

Initiatives of KOKUYO Tohoku Sales
Since the Great East Japan Earthquake, we have continued reconstruction support activities, mainly concentrating on
activities that support children.

Providing Support for the Michinoku Future Fund
KOKUYO Tohoku Sales provides support for the MICHINOKU
Future Fund Charitable Foundation as a corporate supporter. This
fund provides tuition fees (maximum 3 million yen annually) which
are not required to be repaid when high school students orphanedby the Great East Japan Earthquake pursue higher educationsuch as university, college, and vocational schooling with the
purpose of helping children who will build the future of Tohoku,
which is the real basis of recovery, to grow up without abandoning
their dreams and hopes. Agreeing to that purpose, KOKUYO
Tohoku Sales has been supporting the fund since 2012.
This fund does not stop at simply providing scholarships. Periodic

Gathering of the sixth graduating class of students held

events, annual interviews, and interactions with corporate

in March 2017supporters are also sponsored with the heartwarming intention that children who have endured painful experiences will
not be left alone. In March of every year, events to celebrate new students' entrance to schools of higher learning andenrolled students' graduation are held with supporters and others involved, in which the students have an opportunity topassionately discuss their future dreams and goals.
KOKUYO Tohoku Sales, along with the MICHINOKU Future Fund Charitable Foundation, will continue to support theseyoung people's dreams of higher education.

Campus Art Award 2017, a Painting Competition for Junior High and High School Students
Since 2015, KOKUYO has held the Campus Art Award for junior high and high school students jointly with the Yomiuri
Teens Newspaper (issued by the publishing company The Yomiuri Shimbun).
The contest theme was "My Sweet Home Town - a Great Favorite of Mine." The aim is to create opportunities for the
youth of Japan's future to turn their attention to their local areas, to notice their attractiveness and to share that withothers by taking up the theme of local landscape, customs, traditions, events, food, confectionery, etc.
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Third-Party Assessments

The winners for the Grand Prix, the Yomiuri Teens NewspaperAward, the KOKUYO Award, and the District Merit Awards wereselected from 1,393 entries. The Grand Prix went to "The Best of
Koshigaya" by Anna Gotoh.

Campus Notebook with the Grand Prix-winning work
"The Best of Koshigaya" on its cover was sold as alimited edition item on KOKUYO's official online shop.

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Regional Communities

Initiatives in China

Donating Notebooks through the Consulate General of Japan in Shanghai
In March 2017, while giving a lecture introducing Japan at the
China-Japan Friendship Changzheng Elementary School in
Huangbo Town, Ruijin City, Jiangxi Province, the Consulate
General of Japan in Shanghai gave KOKUYO notebooks as gifts
to the students there.

Chasing Big Dreams with Small Notebooks! - Handing Dreams and Books to Children
From May 21 to 23, 2017, five employees from the Shanghai,
Beijing and Shenzhen offices of KOKUYO (Shanghai)Management Co., Ltd., KOKUYO Commerce (Shanghai) Co., Ltd.
and KOKUYO Furniture (China) Co., Ltd. gathered together tovisit Liufang Primary School in the town of Mingkou in Leping City,
Jiangxi Province, and interacted with the children there.
On this visit, in addition to donating KOKUYO stationery including
Campus notebooks, we donated about 200 books collected fromall the employees of KOKUYO Group in China. The employee
volunteers spent a meaningful day with the children, readingbooks and doing crafts using KOKUYO stationery.
We organize these kinds of interchange activities with children
every year. Seeing the stationery they have made bring smiles toso many children's faces was an irreplaceable experience for theemployees. KOKUYO is actively having its employees participate
in volunteer activities to help them personally understand theconcept of contributing to society through our products.

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Presenting Gift Sets to Poor Children to Celebrate Discharge from Hospital through Cherry
Blossom Foundation of the Shanghai Japanese Commerce & Industry ClubIn May 2016, the Shanghai Japanese Commerce & Industry Club established the Cherry Blossom Foundation based ona cooperative agreement with the Shanghai Children's Health Foundation. For three years, the Cherry Blossom
Foundation has been helping poor families with surgery or treatment expenses for their children who are suffering fromstrabismus or congenital dislocation of joints. Additionally, the Club presents celebratory gift sets packed with stationery,
sweets, etc. to children being discharged from the hospital.
On September 15, 2017, members of the Club visited the Children's Hospital of Shanghai and handed the celebratory
gift sets directly to the child patients who had been receiving support. The gift sets included stationery donated by
KOKUYO.

2017 KOKUYO Mid-Autumn Moon Cake & Fund-Raising Activities
For the Mid-Autumn Festival of 2017, the KOKUYO Group in
China distributed specially made moon cakes to its employees aspart of a fund-raising activity. The employees were able to donate
money by simply scanning a payment code found inside the mooncake box with a smartphone. Notebooks, erasers, pencils, etc.
purchased with the donated money were presented to primaryschools in mountainous areas.
The mountainous regions and farming areas in the interior of
China still lack sufficient educational infrastructure, and students
in many areas do not have enough school supplies. In order tohelp as many children as possible have dreams for the future,
KOKUYO plans to continue pouring resources into educational support activities for children.

Initiatives in India

World Art Day 2017
As part of its annual celebration of Camlin Art Week, Kokuyo
Camlin celebrated with a series of art events including a painting
activity organized at the renowned Welham Boys School in
Dehradun. Camlin Art week was organized to commemorate
World Art Day, which is on April 15th, the birthday of Leonardo Da
Vinci.
Students divided into 15 teams, hailing from well-known boarding
schools from across Dehradun and Mussoorie, participated in anart event on April 12, 2017. The students painted large canvaseson the theme of "Future through the eyes of the Past", under the
special guidance of their art instructors.
The beautiful paintings created by these school children were exhibited on April 13th at the Welham Boys School,
allowing the general public to enjoy them, as well. In a glittering function held at the School, all the participants were
honored for taking part in the painting activity. Noted Indian Artist and Sculptor Jatin Das was the special guest. Other
important dignitaries attending the event included Chief Marketing Officer, Kokuyo Camlin, Saumitra Prasad, and thePrincipal of Welham Boys School, Gunmeet Bindra. To add to the celebrations of Camlin Art Week, a number ofworkshops were organized on various subjects including Caricature, Calligraphy, Lino/Wood cut etc. In addition to the49

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on-ground activities, Kokuyo
Camlin also organized an initiative reaching out to audiences on social media platforms. Using the hash tag#ArtWeekChallenge, art enthusiasts were invited to post their artwork every day from April 11-14 and to nominate threefriends to participate as well. Winners will receive exclusive Camlin Fine Art Supply baskets worth Rs. 7000, as well as ahost of other art merchandise. Kickstarted on April 11th, the Art Week Challenge received a tremendous response fromby leading artists in India and art communities on Facebook and Instagram. Prize winners were announced on April 15,
World Art Day.

Kokuyo Camlin gifts notebooks to Assam Flood-affected children
During the recent floods in Assam in the month of August, Kokuyo Camlin helped children there with notebooks for theirregular studies. This activity was done in association with Child Help Foundation Trust which distributed the notebooks
to the affected regions of Assam.

Rally for River
Kokuyo Camlin joined hands with the Isha Foundation, which organized a campaign to save dwindling rivers of India in
September and October 2018. The campaign was led by the spiritual teacher and founder of Isha Foundation, known as"Sadhguru." Kokuyo Camlin organized a creative writing contest across the community's schools, in which the children
were asked to write about the importance of rivers with Camlin Mechanical Pencils - pencils which do not destroy trees
during their manufacture. The activity was very well received with the participation of 1500 schools in 26 cities and the
key events attended by leading dignitaries, including chief ministers, Union Ministers & the Vice President of India.

Children's day with CRY children at Kidzania
Kokuyo Camlin worked together with the NGO CRY to makeChildren's Day (14th November) a very special day forunderprivileged children. An event was organized at the most
exciting venue in the area - Kidzania, where the children enjoyeda fun learning experience, particularly at the Camlin art & craft
studio.

Holding New Year's Celebration with Childhood Cancer Patients
In 2017, KOKUYO Camlin again held an event for children fighting
childhood cancer at Shree Ghadge Maharaj Dharmshala, as it hadin 2016. At the event, the children passed a pleasant time drawing
pictures using KOKUYO Camlin products and enjoying a magic
show.

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Celebrating Teachers day with tree planting
In what could be termed a unique way of celebrating National
Teachers' Day, premiere stationery giant, Kokuyo Camlin joined
hands with the CK Group of educational institutes for a tree
planting day. School children from the institutes each pledged andplanted a sapling to honor their favorite teacher, as a token of
appreciation and gratitude.
A plaque was placed alongside each sapling with the teachers'
name on it, as well as details on the plant and the species it
originated from. The activity was unique in the sense that, byplanting a sapling, each student presented their favorite teacher
with a gift that would last a lifetime. At the same time, the students
also made a small contribution to the environment by planting a sapling to make it greener.
The teachers were extremely humbled and touched by the gesture of students planting a sapling in their name and were
thrilled with the plaques bearing their names placed alongside.

Kokuyo Camlin beautifies the slums in Mumbai
Kokuyo Camlin joined hands with the Social Service League tobeautify under-equipped schools in slum areas. Volunteers
beautified the walls of government schools there, using Camlin
products to create a friendlier and more colorful study
environment.

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Environmental Conservation

While recognizing that solutions to the problems of global warming, deforestation, and other issues affecting the global
environment are urgently required, our entire workforce is committed to combining our collective wisdom in order toengage in actions designed to resolve these issues.

Environmental Management
The Group's Vision for the Environment
Building a sustainable society will require the creation of a recycling-oriented, low-carbon society that can coexist withnature.
The KOKUYO Group Vision for the Environment consists of an environmental philosophy and an environmental policy
with seven specific activities: the prevention of global warming; resource saving and recycling; procurement,
development and supply of environmentally friendly products; biodiversity; legal compliance and preventing pollution;
information disclosure and communication; and environmental management. Based on this vision, all group companies
have developed goals that reflect the characteristics of their business activities and are working on reducing theirenvironmental impact.

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Medium- to Long-Term Environmental Action Plan

Medium- to Long-term Environmental Action Plan (Fiscal 2020)
Environmental
policyMeasuresFiscal 2015

Fiscal 2016

Fiscal 2017

Fiscal 2020

performance

performance

performancegoals

CO2 Cut CO2

Reduced by

Reduced by

Reduced by

Reduced byemissions

8.1%

11.2%

10.3%

30%

(vs. FY 1990)(in Japan)）(in Japan)）(in Japan)）(in Japan)）

globalCut energy

Reduced by

Reduced by

Reduced by

Reduced bywarming

consumption

13.7%

16.4%

16.5%

10%

(vs. FY 2010)(unit energy(unit energy(unit energy(unit energy*Average 1% reduction

consumption)

consumption)

consumption)

consumption)

94.9％

94.5％

94.6％

100％

Prevention of

per year in unit energy
consumption

Resource
saving andrecycling

Increase the rate of recycling
in relation to the total volumeof emissions※incl. waste materials

Migration to ISO 14001 2015
In 2004, the scope of registrations for the environmental management system was enlarged to cover all major
consolidated subsidiaries in Japan. This resulted in a multi-site certification system that encompasses planning, R&D,
manufacturing, sales and services, and warehousing and shipping operations. The environmental management systemis structured to reflect the level of the environmental impact while preserving consistency across the KOKUYO Group.
Companies and factories with a relatively large environmental impact are classified as individual units. Companies witha relatively small impact are classified as common units. In addition, the environmental management system reflects theunique aspects of the activities of each group company. This allows companies to perform environmental managementthat matches their operations, such as by establishing goals based on each company's business plan. While MELON, adatabase system for the management of environmental documents and records, was previously introduced, weenhanced the functionality of this system in July 2013 in an effort to expand the scope of target sites and improve theuser-friendliness, efficiency, and accuracy of document management and browsing.
In December 2016, we received and successfully completed an inspection based on migration to the 2015 version.

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Environmental Conservation

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Third-Party Assessments

Results of Internal Audits and Third-Party Inspection
The KOKUYO Group performs internal audits in two stages: primary audits are conducted by operating companies andsecondary audits are conducted primarily by the ISO Promotion Secretariat. Ensuring compliance with laws andregulations is the highest priority of these audits. Group audits also undergo ISO 14001 third-party inspection and the
CSR Report is checked by a third party. For fiscal year 2017, primary audits were conducted between July 3 and 31,
secondary audits were conducted between August 1 and 31, and third-party inspection was carried out between
November 28 and December 1. Note that the third-party inspection in 2017 was regularly scheduled.

Internal audits

Third-party inspection (ISO14001)

FY in
which

2015

2016

2017

FY in which2015

conducted(update)conducted
Sites subject tomonitoring・Primary audits
・Secondary
auditsMatters cited
・Minor points ofnonconformity
・Corrections

Sites subject to
72

65

70

57

50

55

15

15

15

53

36

28

6

8

12

47

28

16

migration)

2017(periodic)

24

21

0

0

0

31

21

16

Strong points

0

0

0

Good points

8

4

4

examination

29

2016
(periodic/

Matters cited for improvement
・Minor points ofnonconformity
・Improvement
opportunities

Summary of Third-Party Inspection
Environment load data and scope 3 emissions for 31 KOKUYO Group companies have been subject to verification at
KOKUYO's head office. On-site examinations relating to data measurement and management methods have also been
conducted at three sites in Japan (KOKUYO Product Shiga Co., Ltd., KOKUYO Furniture Business Division Engineering Department (Shinagawa Office), and KOKUYO Logitem Co., Ltd. Kansai DC) and one site overseas(KOKUYO Camlin Ltd. Tarapur Factory).This process resulted in a number of matters being pointed out: a total of 9
assessable points, 10 opportunities for amelioration, 26 requests for modifications, and 21 requests for clarification. The
requests for modification and clarification were dealt with during the verification period.
For the verification of scope 3 emissions, the need for clarifying the data collection scope in each category was cited as
requiring improvement because the collection scope had been noted as "consolidated" or "consolidated and affiliate"
depending on the category.
Based on these matters that were pointed out to us, we will endeavor to enhance the disclosure of informationencompassing the entire supply chain and improve the precision of such information.

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ISO14001

ISO14001

Environmental performance data third-party

Third-party audit (KOKUYO workshop)

Third-party audit (KOKUYO Shibayama
Plant)

verification (KOKUYO Product Shiga)

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Environmental Conservation

We are developing an environmental management system with the goal of becoming an Asian company. In order toreduce the amount of greenhouse gases significantly with a view to achieve a low-carbon society, we have expanded
the scope of our reporting targets.

Summary for 2017
If calculated for the existing scope of operations using the electricity emissions factor of 0.378 kg-CO2 /kWh (which is theoverall power average in 2000 as reported by the Federation of Electric Power Companies), the KOKUYO Group's CO2
emissions in 2017 totaled 25,979 tons, 637 tons (2.5%） more than in the previous year. Based on estimates, there
were emission reductions of 440 tons due to operational improvements and 320 tons due to equipment improvements.
Manufacturing operations and the closing and consolidating of facilities raised emissions by 1,390 tons. As a result,
there was an effective reduction in CO2 emissions of 760 tons from a combination of operational and equipment
improvements. Consequently, excluding the impact of production activities, emissions were down 2.4% from theprevious year, allowing us to meet our goal of a 1.4% reduction.
Looking at sources of CO2 emissions, there was an increase of 1,320 tons at factories due to an increase in production.
However, as there was a decrease of 550 tons due to higher manufacturing efficiency and other improvements, factories
recorded a net increase in emissions of about 770 tons. For distribution activities as well, emissions decreased by 25
tons because of measures such as the consolidation of distribution centers. There was also a reduction of 60 tons dueto heightened electricity and energy conservation measures, resulting in a net decrease in emissions of 85 tons. In
offices, emissions were down approximately 40 tons as a result of the more efficient use of heating and cooling systems
and the effective use of heat storage. Additionally, to use energy more efficiently, we oversee unit energy consumption,
which is obtained by dividing energy consumption by sales. In 2017, our unit energy consumption was 0.2% less than in
the previous year
If the 2012 emission coefficients for each of the various countries on the greenhouse gas (GHG) protocol website madepublic by the World Business Council for Sustainable Development (WBCSD) and the World Resource Institute (WRI)
are adopted as the figures for the CO2 emission coefficients and added to the Japanese CO2 emission coefficients
based on the Act Concerning the Promotion of Global Warming Countermeasures (for 2017, actual emission coefficientsfor each electricity company for 2015 and 2016), then the total will rise by 6,598 tons to 32,577 tons.

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Scope of Reporting
While 16 companies were included in the scope of CO2 emission reporting (reporting scope A *1) until 2011, allconsolidated subsidiaries came to be included in the scope of reporting starting in 2012 (for 2017, 31 companies;
reporting scope B *2). As a result, CO2 emissions totaled 43,112 tons (including 1,491 tons at non-consolidated sales
companies). The changes to the emission coefficient and the extension of CO2 emission reporting to the supply chain
have resulted in significant changes for the KOKUYO Group. Consequently, we believe that the medium-term goals foremissions will have to be re-examined.
※1 : A: KOKUYO Co., Ltd., 12 consolidated subsidiaries, and 3 affiliated companies※2 : B: KOKUYO Co., Ltd., 20 consolidated subsidiaries, and 10 affiliated companies (KOKUYO S&T and KOKUYO Furniture were
integrated with KOKUYO Co., Ltd. in October 2015)※Related information: "Changes in CO2 emissions"

Measures Implemented in Offices to Help Mitigate Global Warming
Offices lowered CO2 emissions by 40 tons over the previous year.
Offices lowered CO2 emissions by 80 tons over the previous year.
To accomplish this, we conducted a review of the methods bywhich heating and cooling systems were being operated, a review
of working styles, promotion of no-overtime days and activities
that encourage employees to go home early, and the reduction ofelectricity use, such as by replacing lighting fixtures with LEDs. At
our Shinagawa office, an electric power visualization system isused to lower electricity use during on-peak hour of daytime
through the efficient operation of heating and cooling systems andheat storage tanks. In addition, a program that encourages people
to use public transportation for sales activities cut gasoline use by

Solar panels installed at the new wing of our Osaka
officeabout 8% compared to the previous year, which represents a reduction in CO2 emissions of 30 tons. In 2017, the coolbiz and warm biz campaigns were combined into a smart biz campaign that was in effect all year long.

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Measures for the Prevention of Global Warming in Our Plants
A reduction of 310 tons in CO2 emissions was achieved at ourplants thanks to operational improvements attributed in part to ashortening of the time required to make changes to product types,
the thorough application of rules for the operations of production
equipment, the conducting of inspections, the elaboration of
production schedules, and a reduction of waste made possible
through energy checks. In addition, a reduction of 240 tons in CO2emissions was achieved by embracing energy-saving equipment,
including adopting systems that enable the installation of inverters
and switching to LED lights.
While an increase in production resulted in an increase in CO2

Solar panels installed at Shiga factoryemissions of 1,320 tons on a year-on-year basis, the net increase
was only 770 tons (increase of 530 tons domestically and an increase of 240 tons overseas) resulting from a reductionof 510 tons attributed to the above operational improvements and equipment improvements.

Measures for the Mitigation of Global Warming in Logistics
In the area of logistics (storage and shipping), we reduced CO2
emissions by 85 tons compared to the preceding year.
Operational improvements achieved through the promotion ofdaily energy-conservation activities, along with equipment
improvements achieved through the introduction of energy-saving
lighting fixtures and a review of optimal luminance for lighting
fixtures at distribution centers, reduced emissions by 60 tons.
In operating an automated three-dimensional warehouse,
KOKUYO Logitem's Ina Distribution Center adopted an electricity
demand meter as part of efforts to reduce peak electricity
consumption in response to tight supply-and-demand conditions
for electricity. In 2017, emissions were reduced by 25 tons throughHybrid streetlights installed at our Metropolitan Area
Integrated Distribution Center (IDC)

measures such as site consolidation, resulting in a net decrease of 85 tons when combined with the reduction of 60 tons
achieved through operational and equipment improvements.

Ascertaining GHG Emission Volumes for the Entire Supply Chain
In recent years, a movement to engage in carbon disclosure projects (CDP) and to manage and externally disclose
Scope 3 (encompassing production, shipping, business trips, commutation, and other categories) emissions generated
through supply chains that indirectly emit GHG has been gaining momentum.
While the KOKUYO Group has also engaged in such actions in certain areas such as shipping, actions started to betaken in 2014 in accordance with the Ministry of the Environment's Basic Guidelines on Calculating Volumes ofGreenhouse Gas Emissions.
Generated through Supply Chains. The volume of GHG emissions for the entire supply chain in year 2017 was 371,268
tons of CO2 . Scope 3 emissions accounted for approximately 90 per cent of this figure with 70 per cent thereof attributed
to "Category 1 purchased products and services". Since data has not yet been fully collected from all cooperating plants,
this percentage is expected to rise. Given that there are also problems in other categories, improvements will be madefrom next term.
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Third-party verification services provided by Bureau Veritas Japan
have also been secured to ensure the reliability of disclosed
information and data.

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Environmental Conservation

To promote the growth of a recycling-oriented society, we are endeavoring to reduce, reuse, and recycle by effectively
utilizing limited resources.

Summary for 2017
Improving the Accuracy of Data on Waste Materials
The volume of waste materials generated by KOKUYO Group business offices in 2017, including all consolidated
subsidiaries, was 20,409 tons (including 98 tons at non-consolidated sales companies). This was an increase of 953
tons.
Approximately 600 tons of this amount resulted from increased production at factories.

Measures Taken at Factories
The recycling rate in factories in 2017 was 96.3%. The KOKUYO Group has already achieved zero emissions in relation
to industrial waste materials from our own factories in Japan. The recycling rate for overseas factories in 2017 was
84.8%. We are working to limit the discharge of waste materials and to increase recycling, while considering thedifferent circumstances related to recycling in each country.

Measures Taken by the Logistics Division
The recycling rate in 2017 for the Logistics Division was 98.4%. Cardboard, wooden pallets and other packaging
materials used for packing products in the logistics process are repaired and re-used. In 2017, 30 tons of cardboard andwooden pallets were re-used. We strive to continue efficiently using resources.

Treatment of Waste Materials at Construction Sites
The responsibilities of the prime contractor with respect to the disposition of waste materials generated on construction
sites have been clarified, and the obligations of the waste-generating company have been tightened.
In 2017, efforts were made to contain waste materials in part through a review of the methods by which parts subject toprocessing at construction sites are ordered. As a result, we determined that we generate approximately 3,750 tons of61

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waste materials on construction sites with a recycling rate of approximately 82.7%.
As waste materials generated on construction sites are not homogenous, there are many cases in which recycling isdifficult due to the intermingling of various types of waste materials in a given batch. Nevertheless, we will continue toproperly dispose of waste materials in conjunction with the implementation of controls on their generation and aim toachieve our medium- and long-term target of 100% for the rate at which waste materials are recycled. To promote thegrowth of a recycling-oriented society, we are endeavoring to reduce, reuse, and recycle by effectively utilizing limited
resources.

Reusing and Recycling End-of-Life Products
When we deliver products, we pick up end-of-life products for
disposal from customers and recycle or reuse these items
depending on their condition.
In 2017, KOKUYO Logitem collected 1,820 tons of office desks
and chairs and other used products. Approximately 180 tons of
the collected products were reused, and those that could not bereused were dismantled and sorted for recycling.

Desk disassembly

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KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Environmental Conservation

We are striving to prevent environmental pollution by complying with statutes and regulations relating to the environment
as well as industry guidelines to which we have subscribed and our own standards.

Summary of 2017
Twenty-eight environmental laws and regulations are currently applicable to the KOKUYO Group within Japan. In Juneevery year, we evaluate the status of our compliance with these laws and regulations.
The evaluation results showed no events that violated laws. However, in some divisions, we discovered insufficient
responsibility transfer due to changes in responsible personnel, or insufficient ability on the part of responsible personnel
to satisfy the criteria established by compliance evaluation. Therefore, in 2018, we plan to implement educational
activities to improve the abilities of employees responsible for monitoring compliance.

Proper Disposition of Chemical Substances
The KOKUYO Group endeavors to properly manage and handlechemical substances.
Based on the implementation of the revised mandatory for risk
assessment of chemical substances in June 2016, we are working
on further safety management and environment improvement at
each work place.
For example, at KOKUYO Furniture's Shibayama Plant, thecompany is converting safety data sheets (SDS) for purchased
paint and other items into a database in which warnings for usage
and references to related laws and regulations are included tomake it possible to check required information when needed.
In addition, efforts are being made to prevent accidents by posting

Panels posted for toxicity and hazardousness to be
known to all (KOKUYO Shibayama Plant)

panels indicating warning levels for toxicity, hazardousness, and flammability as divided by color (green, yellow, and red)
based on the content of chemical and other substances at sites where paint and other items are used and by making
warnings more visible for handlers when such substances are used.
Other offices are also practicing safety management appropriate to the situation at their sites.

Holding Chemical Substance Management Training
We hold training sessions on a regular basis to ensure the proper management of chemical substances.
For the annual plan created by the Safety Health Committee being run at each office or factory, we provide clear
guidelines on safe management and operation to ensure that chemical substance management is a continuous activity.

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Environmental Conservation

Corporate Activities

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Third-Party Assessments

Training sessions were held in each office(KOKUYO Headquarters)

Customers

Active kaizen communication among
employees responsible for managing

Making the need for risk assessment wellknown and ensuring appropriate activities inchemical substances(KOKUYO Product Shiga)

the annual plan
(KOKUYO Shibayama Plant)

Ensuring proper management and handling

Ensuring proper management and handling

Ensuring proper management and handling(KOKUYO Headquarters)(KOKUYO MVP Tottori Plant)(KOKUYO Mie Plant)

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Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Environmental Conservation

The KOKUYO Group is working on new environmental technologies and green procurement in order to reduce theenvironmental load over the entire life cycle of its products.

2017 Activities
Continuing to Ensure that No Eco-Batsu Mark Tarnishes Our Catalog
The KOKUYO Group started using the Eco-Batsu mark for products in the 2008 General Catalog. This mark is used forgroup products that are not sufficiently environmentally friendly at any stage of their life cycle, including manufacturing,
distribution, usage, and disposal. We tasked ourselves with removing the Eco-Batsu mark from all of our products inthree years. This goal was reached in the 2011 General Catalog and no Eco-Batsu products have emerged since then.
We strive to continue to ensure that no Eco-Batsu products can be found in the 2018 General Catalog. Our Eco-Batsu
initiative was an opportunity for reviewing manufacturing processes and getting employees not directly involved with
manufacturing to review their own approaches to work, office environments, and proposals made to clients. Since
reaching our goal of zero Eco-Batsu marks, we have been pursuing the development of eco-friendly products thatexceed customer expectations in accordance with the watchword: eco + creative.

Improving Verification
Even after achieving the goal of zero Eco-Batsu marks, we have been verifying conformance to standards more
stringently. In particular, we audit the ratios of used paper and reprocessed resin at our subcontractors every year toensure the reliability of our environmental indicators.

Eco-Batsu mark65

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Promoting the Management of Chemical Substances Included in Products
In recent years, regulations governing chemical substances
including the RoHS Directive and REACH in Europe have beenstrengthened worldwide and demands for reports on the status of
the use of a wide range of chemical substances have been
received from the market. The KOKUYO Group recognizes thatthe non-use of substances regulated by law and the management
and provision of information on the status of the use of
substances for which there is a potentially negative impact on theenvironment and people are social obligations shared by allcompanies that provide products. At the same time, there has
been a clear shift from a conventional hazard-based management
approach that used to focus only on the hazardous nature

Checking for the presence of heavy metals using an
X-ray fluorescence spectrometer

inherent in chemical substances to a risk-based management approach based on the scientific method. In responding tothese global changes, we first set about specifying a hazards-based list of substances in 2014 and in 2015. We thencarried out research based on the substance list in sequence, starting from the highest-priority products. In 2017, basedon information obtained from our research, we evaluated the toxicity of and human exposure to the contained
substances, and created the Stationery Edition of the Guidelines for Managing Chemical Substances Included in
Products.

FSC®-certified products
KOKUYO has obtained FSC® and COC certification since 2003. The Forest StewardshipCouncil® (FSC) is one of several third-party organizations operating an international forestry
and woodlands certification program and aims to conserve the environment found in forests
and woodlands appropriately and promote the management of forests and woodlands in amanner that is socially beneficial for local communities while also being economicallysustainable. COC (short for "chain-of-custody") certification constitutes the certification of the
management of the processes of processing and logistics. In the KOKUYO Group, KOKUYO,
Kaunet and KOKUYO Product Shiga have obtained FSC® and COC certification and areselling copier paper, notebooks, and other FSC-certified products. In 2016, PEFC and COC
certification was also obtained.
PEFC (Programme for the Endorsement of Forest Certification Schemes) is an organizationthat mutually approves forest certification criteria created by each county or region. The KOKUYO Group will strive toincrease certified products in order to use sustainable forest resources.

PPC color paper

Reeds-based photocopier paper

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Protocol counter
The Protocol counter is a reception counter developed to also satisfy the need to use locally harvested lumber
throughout Japan. The finish of the counter, designed by graf decorative mode no.3 design products inc., presents aclean and modern feel. Adopting the concept of universal design, the counter provides, for example, a groove forsecuring walking canes and a grip for wheelchair users at the edge of the countertop.

Winner of the Wood Design Award 2017

Walking cane holder provided at the edge of

Smooth-textured grip at the edge of thethe countertop

countertop for wheelchair users※Related information: "Assessments and awards received from outside the KOKUYO Group"

Koka City, located in the southeastern part of Shiga Prefecture, is gifted with many forests and is also a
crucial water catchment area and water quality conservation area for Lake Biwa.
Koka's new city office building, which was completed in March 2017, was built with a great deal of lumber
harvested in Shiga Prefecture for its interior and furniture, and also acts as an initiator for promoting local
forestry. KOKUYO received an order for the reception counter for the new Koka City Office building, anddelivered a Protocol counter made with hinoki (Japanese Cyprus) grown in Shiga Prefecture. The
Protocol counter, developed in order to use locally harvested lumber for the reception counter, uses
universal design, which is kinder to seniors and wheelchair users. At the same time, it features an elegant
design that highlights the attractiveness of local lumber, making the new office building, which has been
made using a large amount of wood, a more attractive space.
As the national government's initiative to promote the use of lumber in public buildings has become more
widely known, an increasing number of national and local municipality public buildings are using locallyharvested lumber. Capitalizing on the expertise that it has developed over the years, the KOKUYO Groupplans to continue manufacturing and providing products that utilize local lumber effectively, are morefunctional yet friendly to the environment, and are based on the concept of universal design that is easy
to use for anyone.

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Environmental Conservation

The KOKUYO Group strives to reduce its impact on ecosystems and help conserve natural habitats by carrying out
business activities that take biodiversity into account. We are proactively engaged in forest-conservation activities in the
Shimanto River basin area of Kochi Prefecture and environmental conservation activities in the area in and around Lake
Biwa in Shiga Prefecture.

ReEDEN: The Outcomes of Activities over the Past 10 Years

KOKUYO Product Shiga is a main plant for the KOKUYO Group, where notebooks and other paper products are
manufactured. As the plant operates near Lake Biwa, a place that supports the lives of people while also being a dynamic
habitat for many forms of life, KOKUYO Product Shiga has engaged in proactive activities for environmental conservation.
Particular focus has been directed towards activities involving reeds. Reeds not only absorb carbon dioxide but also help
to purify water by absorbing nitrogen and phosphorous in the process of growing and serve as a home for organisms
living in Lake Biwa. Reeds used to be used for making reed screens, roofs, and other goods. However, the use of reeds
for such purposes disappeared as peoples' lifestyles changed, meaning that reed beds were no longer being maintained
and consequently fell into a state of dilapidation. Launched in November 2007 to promote the use of reeds and to makethe state of the reeds widely known, the ReEDEN Project marked its 10th year in 2017.
During this 10-year period, reed-harvesting events were held 31 times, with a cumulative total of 3,530 people
participating. The gathered volume reached approximately 90 tons and the amount of reeds utilized in products
reached approximately 200 tons.
Awards and recognition
2008

Special Recognition Prize in the Green Purchasing
Award
Merit Award in the Eco Products Award

2009
2013 Certified by Kokocool Mother Lake Selection2015 Grand Prize at the Kaueco Grand Prix
2015
2015
2016
2017
2018
2018

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Honorable mention in the company award for thefostering of environmentally-aware personnel
Reed calligraphy pen recognized as one of The
Wonder 500TM collection of products
Reed calligraphy pen awarded the Hanayaka Kansai
Selection Prize
Biwako Template won the Japanese Stationery of theYear Award for Excellence in the Design Category
Shiga Biodiversity Grand Prize
Shiga Prefecture Low-Carbon Society DevelopmentAward

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KOKUYO Group's Basic Policy for Timber Procurement
In 2011, the KOKUYO Group prepared its Basic Policy for Timber Procurement and clarified its stance regarding thesustainability of forest resources that are the most significant of the Group's important raw materials. Since its founding,the KOKUYO Group has broadened and developed its business activities using forest-derived materials, including paper
production. KOKUYO is fully aware of the roles that forests have played and will continue to play regarding global
warming and biodiversity. KOKUYO will aim to develop in harmony with forest resources while taking into consideration
the legality, transparency, and sustainability of the Group's procurement of materials.

The KOKUYO Group procures forest-derived materials according to the following policy and is working to
make continued improvements.
1. Aim for highly transparent materials procurement, with an awareness of issues of illegal cutting andillegal transactions in the timber trade.
2. Procure material through more appropriate supply chains to support sustainable use of forest
resources.
3. Based on an awareness of the social value and roles of forest resources in the region, procurematerials with due consideration for maintaining the supply and preservation of resources.

Use of Domestic and Local Materials
Forests, which accounts for approximately 67% of Japan's land area, play a role in retaining water (usually referred toas soil and sand outflow prevention and watershed protection) and in absorbing CO2 , etc. Forests are also renewable
resources, 40% of which are man-made. However, many of the man-made forests are unable to make the most of theabove-mentioned multiple functions that forests offer as maintenance such as thinning are performed too late.
KOKUYO worked to develop furniture from timber from thinning since 1998 and starting selling them from 2000. We
believe that we can increase the demand for new timber through the active use of domestic timber (timber from thinning)and support the realization of a sustainable society where we live in harmony with forests.

BS+ desk system

Writing table

FUBI

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Obtaining certification as a company dealing with matters of legality and sustainability
We have been certified as a company dealing with matters oflegality and sustainability by the Japan Office Institutional
Furniture Association (JOIFA) in line with revisions made to theGreen Purchasing Act. We endeavor to promote the use and saleof timber and wood products that have been certified as legal andsustainable in such terms as forms control, the appointment ofmanagers, and usage reports in accordance with this practicecode.

Status of the Use of Wood Materials
Approximately 5,200 tons of wood materials were used by KOKUYO Furniture in the year 2017 to make products. This
figure is equivalent to 9 per cent of all materials used for production (excluding packaging). In breaking down thesewood materials, 30 per cent consists of solid wood, laminated wood, and other wood materials that are made with raw
lumber while 70 per cent consists of wood materials that are not made with raw lumber, such as thinned wood, waste
wood, unused materials and wood boards constituting pieces fabricated from the foregoing materials (MDF and particle
boards). This information is reported annually to JOIFA as yearly handling results for certification as a company dealing
with lawful wood materials under the Green Purchasing Act. We also endeavor to ascertain the types of trees
corresponding to wood materials that are made with raw lumber pursuant to JOIFA's guidelines on the written
declarations that are made of wood.

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Study on the actual usage of wood
KOKUYO studies the tree species, amount used and the country/ regions of origin of the wood-based materials used in
its furniture products every year. However, it is hard to determine the country of origin for commercial components andsimilar items. We will continue to work towards obtaining the information in order to use sustainable resources.

Tree species

Form of wood

Amount used(converted to m³)

Country/region of

Ayous

Solid wood

266.1

Indonesia, Cameroon

Oak

Solid wood

0.1

Malaysia

Kapur

Solid wood

23.8

Malaysia, Indonesia

Japanese cedar

Solid wood

2.9

Japan

Oak

Solid wood

1.4

RussiaPine

Solid wood

72.0

New Zealand, Chile

Beech

Solid wood

57.6

Germany, Thailand, Croatia

Hinoki cypress

Solid wood

1.2

Japan

Falcata

Laminated woo

99.5

Indonesia

PoplarSolid wood

217.6

Indonesia, USA, Canada

White Oak

Solid wood

0.3

Canada, USA

Gum TreeSolid wood

308.0

Vietnam, Australia

Rubber wood

Solid wood

83.2

Indonesia, Thailand, Germany, Malaysia

Laminated woo

458.0

Malaysia, Indonesia, Philippines

Lauan
Total

1,591.6※Information from suppliers has been included. Wood materials such as MDF that do not use raw lumber as materials have been excluded.
※Only tree species with the specified country/region of origin are shown.

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Yui no Mori ProjectIn 2006, KOKUYO named the private forest in Taisho, Shimanto-cho, Kochi Prefecture "Yui-no-Mori" and started forest
conservation with a focus on efficient utilization of timber from forest thinning. Yui-no-Mori has had FSC® (Forest
Stewardship Council®) forest management certification since 2007. In the same year, KOKUYO concluded thepartnership agreement of "Collaborative Reforestation Project with Environmentally Progressive Companies"(Shimanto
Forest Cooperative /Shimanto-cho/Kochi Prefecture) by Kochi. With the expiration of the partnership agreement in 2016,
the agreement was revised and re-concluded under a condition of renewal every year on April 1, 2016. Yui-no-Mori is
about 100 hectares, and the thinned forest area was 2 hectares when it was started. After 11 years, the applicable area
became 5,429 hectares, and the total thinned forest area has expanded to 1,416 hectares. In addition, a CO2 absorption
certificate has been issued by Kochi Prefecture since 2007, and the amount of absorbed CO2 of FY2016 was 6,598 tons
raising the cumulative total to 43,058 tons. (From April 2006 to March 2017.) The Yui no Mori Project won the Wood
Design Award 2017.
※Related information: "Assessments and awards received from outside the KOKUYO Group"

Yui no Mori Project Receives Letter of Appreciation and CO2 Absorption Certificate from
Kochi Prefecture
On September 21, the 11th Collaborative Forest Forum was held at the Kochi Prefectural Culture Hall. Because 2017
marked the 10th year of its participation in the project, KOKUYO received a letter of appreciation from Kochi Prefectural
Governor Ozaki. A CO2 absorption certificate was also presented.
Mr. Ozaki expressed his gratitude for KOKUYO's long-term contributions to various initiatives, such as environmental
conservation, forest maintenance, industry promotion, and the promotion of Kochi Prefecture.

Presentation of a letter of appreciation

Presentation of a CO2 absorption certificate

Wood Design Award (at the Eco Products
Exhibit)

KOKUYO has obtained FSC® certification
Yui-no-Mori has had FSC (Forest Stewardship Council®) forest management certification since 2007. A regular audit
was conducted on August 23 and 24, and KOKUYO continues to maintain FSC® certification.
Tours for Fully Fledged Certified Employees and Monitoring

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Tours for Fully Fledged Certified Employees and Monitoring
Over 2 days on November 11 and 12, a Yui no Mori experience tour to commemorate employees' fully fledged
certification was held for employees in their 4th year at the company who had cleared certain requirements and taken
their fully-fledged certification. Through various activities such as surveying the water quality of Shimanto, planting
commemorative trees and gathering with the local Shimanto Forest Cooperative and Shimanto High School, the tour
aims to improve employees' environmental awareness and increase their interest in KOKUYO's environmental activities.
In one of the events, we conducted a vegetation survey for the 11th time in collaboration with the Shimanto Forestry
Cooperative, Shimanto High School, and staff members of the K?chi prefectural and Shimanto municipal governments.
The visualization of the effects of thinning is essential for carrying out forest conservation activities. In order to monitor
the effects of these activities over the long run, we are continuing to conduct surveys at two specific sites.
※Related information: "Report by Shimanto High school students"

FSC® Audit

Participants in the monitoring activities

Vegetation survey being conducted

Effective Utilization of Forest Thinning
In order to effectively take advantage of forest thinning, KOKUYOFurniture has been manufacturing and selling furniture made withtimber from forest thinning in collaboration with the local Shimanto
Forestry Cooperative since 2000. Catalog retailer Kaunet alsobegan selling primarily stationery as Yui-no-Mori branded products
in 2007 and currently offers 14 items as of 2017. In order topromote understanding of its activities and increase the number of
supporters, Kaunet implemented a framework for donating
customer points toward the thinning of Yui-no-Mori in 2008. This
year alone, the company has received approximately 90
applications for the submission of donations. In addition, the Yuino-Mori 1%Donation Project was commenced in February 2011
Kaunet's Yui no Mori Products
and continues to operate to this day. This project is to donate a
portion of the sales of Yui-no-Mori products to the National Land Afforestation Promotion Organization's Green Fund.

2017 Activities of ReEDEN ProjectProtecting Lake Biwa by Promoting the Use of Reeds
By harnessing production technologies developed to date and its developmental capabilities with a paper-production
company, KOKUYO Product Shiga has been using reeds to produce copier paper, notebooks, and other industrial
products and selling them at a price suitable for the market under the ReEDEN Series brand name. In addition, in aneffort to create a market that contributes to the environment through the use of reeds, business cards made with 100
percent reed pulp, reed-based brush pens, and other high value-added products have been developed. Other efforts
included the release of Lake Biwa stationery series as locally made stationery with themes relating to Lake Biwa, Shiga
tours and local specialties, and the joint development by Lake Biwa Museum in Shiga Prefecture and Campus Notes. A
portion of sales is donated to a local environmental organization for activities dedicated to the conservation of reeds.
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ReEDEN series

Lake Biwa stat

Customers

Biwako Template※Related information:"ReEDEN Project"

Recruiting Members of the Local Community to Protect Lake Biwa with Reeds
The Network to Protect Lake Biwa with Reeds was set up in 2009 with KOKUYO Product Shiga serving as thesecretariat of this organization. This network aims to contribute to the conservation of the natural environment of Lake
Biwa in part through the establishment of modest connections among various companies and organizations. This
network, which began with a handful of corporate members, now boasts a membership of 123 supporting entities. The
primary activity of the network entails the conservation of reed beds that fulfill an important role for the Lake Biwa
ecosystem and water environment. These activities, which were initially staffed by several KOKUYO Product Shiga
employees, have now expanded significantly to activities in which members of local environmental groups andrepresentatives of network members now gather in the hundreds to participate, with 3,530 members participating inmowing the reeds. We will collaborate with experts to investigate biomass of reed bed as our next attempt. We will
demonstrate the achievements of the activities by investigating biomass, carbon content, and so on. We are also
working with Shiga Prefecture to prepare for a possible future carbon certification system for reeds based on this data.
These activities shared along through network communications alongside topics relating to local environments by
specialists and introductions of environmental activities of member companies to increase camaraderie.
※Related information:"The Network to Protect Lake Biwa with Reeds"

Expanding Activities: Non-native Fish Fishing Contest and Canoe Reed Bed Observation
Event
The Network to Protect Lake Biwa with Reeds, consisting of various different industries and organizations, is expanding
its activities year after year. The reeds are mowed in winter so that buds start to sprout in the reed bed when the springcomes. We have held a fishing contest to remove non-native fish around the reed bed since 2011. The aim is toexterminate the black bass and bluegill that threaten endemic species of Lake Biwa such as willow gudgeon andcarassius auratus grandoculis. This environmental activity can be enjoyed by Network members and their families
together. The number of participants is increases each time, with approximately 170 people participating last year. We
contribute to conserving the ecosystems of Lake Biwa together with children. The canoe reed bed observation event isan event to observe thick reed beds from the lake surface in summertime by riding canoes through a maze-likewaterway. The delighted and amazed voices of participants echo as they stroll around the reed bed, where they cut andtake reeds from the surface of the lake onto their canoes.

Fishing contest to remove non-native fish

Observation of reed beds from canoes

Biomass survey of winter reeds※Related information:"ReEDEN Journal"

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Corporate Activities

Continuously Holding Compliance Training at Overseas Group Companies

KOKUYO-IK (Thailand) Co., Ltd., which manufactures
stationery products in Thailand, has continued to hold annualcompliance trainings since 2013 with the goal of enhancing
its employees' compliance awareness. To ensure that every
employee fully understands the importance of compliance,
all employees, including directors and managers, attend thistraining. In the training session held on January 5, 2017, theparticipants together read out loud the KOKUYO Group
Code of Conduct, which applies to all companies within the
KOKUYO Group, to reconfirm the code, therefore making

Explanatory material in Thai language

the training session an important platform for reaffirming thesignificance of compliance. For KOKUYO-IK (Thailand),
which operates 24 hours a day, this training session is also an extremely important opportunity for all employees(approximately 270 people) to gather together. Utilizing this opportunity, all employees enhanced their awarenessas members of the KOKUYO Group by, for example, reciting together the KOKUYO Creed (Thai language
version), in which the KOKUYO founder Zentaro Kuroda clearly stated his own management philosophy.
For companies planning to expand overseas business, the management structure in their overseas groupcompanies is a major issue, and the development and propagation of compliance awareness in particular has
become important. In order to continue complying with laws and regulations and carrying out business activities inaccordance with social ethics, the KOKUYO Group plans to actively carry out training to promote compliance thatis consistent with the local situation at its overseas sites.

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Basic Concepts
Corporate Governance StructureWith the aim of ensuring the reproducibility and continuity of transparent, apt, and efficient business administration, weestablished a structure for corporate governance. In order to ensure that business and operations are carried out without
improprieties, without mistakes, and efficiently, we developed and are operating a system of internal control that we are
striving to improve and enhance on an ongoing basis. Headed by various board members, key committees linked tointernal control appoint members from among multiple related sections and endeavor to systematically promote andfortify responses to important issues concerning CSR on a group-wide basis.

Board of Directors, Audit & Supervisory Board Members, and Managing Officers
For a list of the members of the board of directors, please see the basic information in the Corporate Profile.

KOKUYO's Basic Policy of Intellectual Property Rights
As one of the strategies to differentiate ourselves from competitors, the KOKUYO Group promotes the following
initiatives to encourage the acquisition of intellectual property rights, and at the same time, to respect intellectual
property rights of others:
1) Management and Operational Structure of Intellectual Property Rights
The KOKUYO Group aims to standardize and centralize utilization and strategies for intellectual property rights bycontrolling operations related to the intellectual property rights of subsidiaries and affiliated companies in Japan andoverseas centrally within the intellectual property rights group of the legal department.
The group monitors the products of our competitors on a daily basis for the acquisition of rights in inventions, design,and trademarks; as well as executing thorough preliminary surveys to prevent a violation of the intellectual property
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rights of others; and protecting our intellectual property rights. In addition, in cases where there is a conflict withcompetitors, the group corresponds to such a situation through cooperation with the management by taking a rapid andoptimal approach for resolution.
2) Protection and Legal Compliance of Intellectual Property Rights
The KOKUYO Group Code of Conduct stipulates that we respect the intellectual property rights of others while theintellectual property group establishes and operates the system for research, analysis, and close investigation to prevent
and avoid the violation of rights held by others.
3) Promotion of Creation and Utilization of Intellectual Property Rights
The intellectual property group and development division work closely from the early stage of development to increase
the superiority of the products in the market and focus on creating and discovering inventions that contribute todifferentiation from competitors' products. We also aim to adhere to Sec. 33 of the Patents Act and establish an
incentive system for employee invention as an internal rule, in the aim of increasing customer satisfaction andencourage inventions that strengthen the Group's development.

Operation of a Whistle-blower System, KOKUYO Group Hotline
The KOKUYO Group Hotline is a hotline where employees can seek advice on problems related to compliance andcorporate ethics that are difficult to counsel and resolve within the workplace. It is a global system that can be used not
only by employees in Japan but also by the employees of the KOKUYO Group at overseas offices.

Commencement of Group-wide Risk Management Promotion
The KOKUYO Group took the opportunity of the integration in 2015 to establish an organization and start taking steps topromote risk management.
The aim of this activity is to establish a risk management circle from the Group's point of view. First, we started withrecognizing what kind of risk exists in the entire KOKUYO Group, and considered policy of prioritization and measuresfrom a perspective of what is best for the Group as a whole, and then promoted it.
We will clarify the particularly important themes or themes related to the entire organization, and aim to improve theeffectiveness and efficiency of risk management by advancing the activity across the entire Group.

Formulation and Implementation of Business Continuity Planning (BCP*)
Business Continuity Planning (BCP) defines action plans to continue business operations to the best of our ability after
the occurrence of unforeseen circumstances, such as disasters and accidents, as well as action plans to recover andrésumé business in as little time as possible where interruption is unavoidable.
In order to product supply with greater stability even in critical times such as disaster or outbreak of infectious disease,
KOKUYO Group is thorough in its Group-uniting crisis management and will continue to promote continuous business
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BCP and Emergency-Handling Training by the Furniture Business Division
Because KOKUYO's response structure and action procedures
did not function fully following the Great East Japan Earthquake,they were completely revised and training was held to verify thedetails of the revision. The BCP and Emergency-HandlingTraining was held by the Furniture Business Division on
December 6, 2017. The training assumed that a Tonankai
Earthquake had occurred, severely affecting the abilities ofbusinesses in western Japan to continue operating. The intent of
the training was to validate the effectiveness of the early response
if the furniture business' continuity emergency headquarters were
set up in the Shinagawa SST Office. The training turned out to bea large-scale event, with a total of 73 employees participating inTokyo and western Japan. We will develop solutions for the issues
identified during the training, and reexamine our response

Participants, who were divided into teams according tofunction, discussed whether executing the specified
action procedures would handle the potential crisis
scenarios that they had been assigned.

structure and action procedure in order to make them more effective.

Early Response Measures during Disasters
To ensure that all employees can restore calm behavior in theevent of large-scale disaster, we distributed survival cards that list
procedures to be followed during times of disaster and ask that all
employees carry the cards with them at all times.
The survival card provides three rules to follow during disasters (1) to ensure one's personal safety, (2) to remain calm, and (3) toreport one's own condition - as well as information about how tobrowse disaster message boards offered by cell phone companies
and an information section for identification in case of unexpectedcircumstances.
In addition, the emergency action plans for employees thatprovide a full detail of the survival card are posted on the intranet

Survival cards (left) and emergency action plans for
employees (right)

to raise awareness of measures for disasters.

Creation of a Safety Confirmation System and Implementation of Practice
To quickly confirm the safety of Group employees in times of disasters, in 2006, we set up a safety confirmation systemusing cell phones, PCs, fixed line telephones and other means of employee communication. Immediately after theearthquake in March 2011, it was temporarily impossible to use telephones and e-mail. At present, however, there is noother alternative systems available to confirm the safety of a large number of employees at the same time. For the time
being, we will continue to require all employees to register their cell phones and other contact addresses, and makesure that all employees receive notification and that contact information is kept up to date and in a usable state.

Implementation of Emergency Drills at Business Locations
To ensure that all employees take safety precautions on their own in an emergency, along with regular countermeasuresfor earthquakes, we are conducting periodic training and drills simulating a large-scale earthquake on weekdays.
The Osaka Headquarters and the Shinagawa Office holds an evacuation drill simulating the situation after receiving an
early earthquake warning. Actions for maintaining safety by taking cover under desks were implemented. Based on the
scenario of an office fire following an earthquake, full emergency training is being offered, beginning with immediate78

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firefighting and simultaneous reporting to the fire department anddisaster center, through to evacuation after abandoning firefighting
efforts.
The KOKUYO Group will continue to increase Group-wide crisisresponse capability in the future.

An emergency drill held at the Osaka Headquarters

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KOKUYO is aware that increasing corporate value is our responsibility to shareholders and investors. KOKUYO strives
to make accurate and timely disclosure of corporate information in order to maintain transparent and sound corporate
management.

Work Style Reform Suggestion Committee Started with Retailers forTrue Work Style Reform

Seizing a business opportunity in the trend for work stylereform, which many companies are striving for, KOKUYO
started the Work Style Reform Suggestion Committee(nicknamed "Action to Change Workstyle" (ACW)) together withretailers who are KOKUYO Jewelry Members (KJM)*. The mostimportant goal of this committee is to strengthen therelationship between retailers and customers, resulting insustained growth for both KOKUYO and the retailers. Between
April and May 2017, ACW Kick-off meetings were held at fivelocations. Afterwards, a forum was held at 29 locations
throughout Japan to explain specific activity details to the sales
staff of the retailers that had agreed with the objectives of theWorking Environment Navigation Tool that visualizes theissues existing in the customer's working environment

ACW. The ACW has also prepared a variety of mechanisms to
support retailers' sales activities, such as tools for effectively drawing out customer issues and needs, and workshops toimprove proposal-making skills.
There have been strong public calls regarding the importance of work style reform and initiatives to achieve it. However,while many IT tools and various systems for preventing overwork are being introduced, working-level people are
increasingly complaining that efforts toward work style reform have not produced any results and that the situation has
actually gotten worse. Therefore, the ACW will proceed with proposal-making activities to achieve a working
environment that is truly friendly to workers and in which both efficiency for the company and comfort for individual
workers can be achieved so that individuals and teams can demonstrate creativity. The process will begin with reform of
the working environment (working space), which directly affects the mindset and actions of workers, as well as tools(stationery and furniture necessary for working), and operation (the 5S rule, etc.).
* A system to rank and incentivize retailers who sell more than a certain amount of KOKUYO products based on annual sales.

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Basic Concepts
Building Stronger Relationships of Trust with Our Suppliers
As corporate activities are becoming more globalized, KOKUYO Group is well aware that managing its own company
and subsidiary companies is insufficient for fulfilling the scope of social responsibility. In 2013, the Group therefore
invited 32 principal subcontractors to give an account of the procurement policy and implemented a self-examinationquestionnaire for feedback to the subcontractors. In 2014, we sent the basic procurement policy and guidelines to nearly
400 suppliers. We will strive to further build relationships of trust through these activities.

The KOKUYO Group shares its Corporate philosophy of "Enrich the world though our products" with its
suppliers and, while working to create relationships of mutual understanding and confidence as well as
fulfilling its social responsibility, continues to contribute to social development.
Pursuit of Quality and Safety
The Group strives to maintain its position as the first choice of its customers, while responding to thespecial needs of various countries and regions as well as pursuing the highest standards of quality andsafety.
Mutual Development
The Group respects and observes the regulations as well as social norms of various countries andregions, while also conducting fair and transparent transactions, as it works to structure sincere
relationships of mutual trust and achieve mutual development.
Respect for Human Rights
The Group understands the culture and business customs of various countries and regions in the aim ofcreating a society where the rights of all people are respected.
Environmental Protection and Symbiosis with Local Community
The Group takes environmental protection initiatives on a global scale and, by actively participating in thelife of the community and acting as a good corporate citizen, seeks to create mutually beneficial
relationships with society.

KOKUYO Group Procurement Guidelines
The Kokuyo Group fulfills its social responsibilities throughout its supply chains. To contribute to society through its
business activities, the Group has prepared its Kokuyo Group Procurement Policy and the Kokuyo Group Procurement
Guidelines.

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Project to Link Logitem Delivery Center to Head Office Divisions
During the relocation of KOKUYO Logitem's head office divisions
to the second floor of the KOKUYO headquarters office, an area
where employees can actually see and touch KOKUYO products
was set up in the middle of the office. Named the "Touch & Look
Hub," its purpose is to facilitate linkage between the head officeand the delivery center. Here, the "Linking Project"* regularly
holds trainings with the goal of helping head office employees toimprove their product knowledge and become more familiar with
operations that take place at the site (delivery center).
The Linking Project plans to continue holding a variety of training
sessions at the Touch & Look Hub to build a mechanism that links
the head office with the delivery center.
* The Linking Project is made up of KOKUYO Logitem female employees

At the Fourth Training held on February 15 and 17,
participants were divided into two-person teams andtried out assembly work

who worked on workplace environment improvement as part of the "What I'd like to be" project, as well as members of the Future Workshop,
which is deliberating future distribution issues related to KOKUYO furniture.

New Product Briefing Held in Hanoi, Vietnam, Inviting Partner Companies
On March 2, 2017, KOKUYO Vietnam Co., Ltd. held a meeting in
Hanoi to demonstrate new products for FY2017, inviting
approximately 130 influential wholesalers and retailers in thenorthern part of the country. In addition to new productexplanations, the meeting introduced the Campus 1 Gia Dinh?
Campaign ("1 Gia Dinh?" means "One family?" and is a key
policy, chosen with the hope that the manufacturer, wholesalers,
and retailers will grow together like a family). Incentive trips toJapan were also introduced and wholesalers with excellent results
were recognized by presenting them with plaques.
KOKUYO aims to build strong bonds with distribution partners in
Vietnam and grow together to become companies that are

Plaques presented to express appreciation towholesalers with excellent results in 2016

cherished by customers.

Events Held to Celebrate the 20th Anniversary of the Founding of KOKUYO Malaysia
On April 21 and 22, various events were held, including a 20th
anniversary ceremony for KOKUYO Malaysia Sdn. Bhd. In theanniversary ceremony on April 21, commemorative photos weretaken and tree planting was carried out with a hope for the future
expansion of international business. On the day of the ceremony,
the International Business Division also held an ASEAN strategy
meeting, attended by representatives from local sales subsidiaries(in Malaysia, Thailand, Singapore, and Indonesia) that had
generated record-high profits in 2016, and animated discussions
were held for the achievement of further growth.
At the annual dinner* held on April 22, all participants, including
guests from Japan, wore traditional Malaysian batik clothing,

Commemorative photo taken for the 20th anniversary
with people forming the number "20"making the party quite lively and full of enriching interactions.
* A party that Malaysian companies hold once a year and invite their employees to. It is similar to the "forget-the-year party" in Japan.

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Subcontractor Meetings Held by Kokuyo's Furniture Business Division
Kokuyo's Furniture Business Division holds subcontractor
meetings with the executives of major subcontractors twice a year.
In 2017, the meetings were held in May and December. At the
May meeting, participants reflected upon the high demand season
and shared their forecast for future sales trends. At the December
meeting, the furniture business division reflected upon the current
financial period, and also explained their policies for the 2018 highdemand season and market trends.
In addition, KOKUYO expressed its gratitude by formallyrecognizing subcontractors that took excellent initiatives. Theirinitiatives were also presented, enabling us to learn from one
another to support our coexistence and co-prosperity, andExplanation by Mr. Sakagami, Group Managing Officer
and Head of Furniture Business Divisioncooperate to improve the entire furniture business.
In November, a study meeting was held targeting mid-level
employees in the design and development departments of
subcontractors, to share KOKUYO's approach to market analysis
and design concepts in its monozukuri.

Ceremony to formally recognize superior subcontractors"Driver Competition" contest for achieving impressive deliveries
Since 2010, KOKUYO Logitem, the company responsible for
distribution, has held the Driver Competition involving truck driversof partner companies and other operators, with the goal of further
improving customer satisfaction in the delivery of our furnitureproducts. The level of recognition for this competition has been
increasing both inside and outside the company year after year asa platform for fully demonstrating abilities in product assembly andcustomer service cultivated through everyday efforts. The
competition level has also been increasing every year. The theme
for the eighth competition held in 2017 was "Thoroughness in
Basic Actions." The national final was held on September 9, andthe winner among 364 entrants from all over Japan was chosen.
The event helped the participants to return to the basics ofproduct delivery and also learn techniques for preventing theincreasing number of accidents resulting in property damage.

In addition to simulated delivery and assembly, vehicle
guiding was newly added as one of the categories in thisyear's competition

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Stationery Business Conducted an Audit of Subcontractors
The Stationery business has been implementing an audit of subcontractors for the purpose of securing reliability ofenvironmental indicators in product catalogs. In 2017, we conducted a factory audit of 90 companies.
We visit our subcontractors to check for compliance with standards concerning environment-friendliness established by
the Green Purchasing Law, etc. The audit follows the audit procedure established by KOKUYO to confirm whether theratios of used paper and reprocessed resin conform to the standards, whether specified materials that meet thestandards aroused in the production process, and whether there are any issues in the legitimacy of materials. In
addition, we work with the subcontractors to consider challenges to properly guarantee compliance with environmentconscious standards in the audit.
By exchanging information on examples of cases where reliability with regards to production control was improved, we
will strive to ensure the reliability of environmental indicators in the future.
In order to enhance the values that we offer to our customers, we will aim to achieve mutual development based onlong-term relationships of trust by sharing our strategies and policies with both our manufacturing and logistics service
suppliers periodically.

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KOKUYO is aware that increasing corporate value is our responsibility to shareholders and investors. KOKUYO strives
to implement accurate and timely disclosure of corporate information in order to maintain transparent and soundcorporate management.

Basic Concepts
Policy and Achievements Regarding Dividends
We are working towards sustainable business growth to maximize corporate value in the medium- to long-term and toincrease dividends paid to shareholders. In FY2017, we offered an annual dividend of 29.0 yen per share (13.5 yen as
an interim dividend and 15.5 yen as a year-end dividend). Retained earnings are actively employed to makeinvestments for future growth.

Making Management More Transparent
1) IR Activities
We strive to fairly and accurately convey the KOKUYO Group businesses, corporate attitude and vision for the future, as
well as achieve two-way communication. In 2017, we conducted the following IR activities:■For institutional investors:
The financial results briefing was held twice last year. At the briefings, the President and CEO spoke about theGroup's results and strategies. We also explained the Group's status through individual visits, small meetings, andforeign investor conferences.
■For individual investors:
In addition to explanations regarding the Group, the person in charge of product development introduced the productdevelopment process to help increase understanding of the Group and to foster a sense of familiarity.
We will continue to proactively engage in IR activities to increase our corporate value.
2) Information Disclosure:
We disclose information in accordance with the rules established by the Tokyo Stock Exchange for the timely disclosureof corporate information by issuers of listed securities (hereinafter referred to as the "rules of timely disclosure"). With
regards to information that may not be subject to the rules of timely disclosure, we also endeavor, as a matter of basic
policy, to promptly disclose as proactively and fairly as possible by way of appropriate methods so as to help investors tounderstand our company better.
※ Related information: IR News86

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Shareholder Special Benefit Plans
To respond to the continuing support of KOKUYO shareholders
and with the aim of significantly deepening the understanding of
the KOKUYO Group by having shareholders actually use Group
products, KOKUYO has established a shareholder special benefit
plan. Under this plan, KOKUYO Group products are sent once per
year to holders of 500 shares or more.

KOKUYO Group products sent to shareholders at theend of December, 2017

On May 12, 2017, an IR event was held for individual investors
titled "Company information session: Story of 'Dotliner' tape glue
development" to secure loyal stockholders.
In general, individual investors invest in shares to gain profits
through stock dealing and to obtain dividends. As such, theholding period of shares is unstable. However, we believe thatby making individual investors loyal fans of KOKUYO, they will
become great customers for our products and services and will
end up holding onto shares for a longer period of time.
Therefore, in addition to the provision of information such as the company overview and future businessstrategies through the standard investor information sessions, we held an IR event to convey stories
relating to products so that investors could understand KOKUYO better and become better acquainted
with the company.
The first part of the company information session described KOKUYO's history, overviews of eachbusiness, financial status, strategies for the future, target for the period ending December 31, 2017. In thesecond part, the person responsible for the Stationery business introduced the development process,which took about 3 years, and the product line-up of the Glue Tape "Dot Liner", which was launched in2015 and achieved cumulative sales of 100 million.
Of the individual investors who attended the event, some requested more detailed information relating to
the business and finances, while many shared opinions and thoughts on KOKUYO's focus when creating
Campus notebooks.

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With the issues facing society in recent years becoming more diversified and complex, we are striving to create
KOKUYO-style values so that our customers' work, learning, and living can become more creative and fruitful.

Innovative Chair "ing" that Changes the Concept of Sitting

The "ing," debuted with great fanfare in November 2017, is achair based on a completely new concept that supports boththe mind and health of office workers, freeing them from"sitting." Recent surveys indicate that the number of hours
Japanese people sit on a chair each day is the longest in theworld, and the heightened health risks caused by thisextended sitting have become a serious social problem.
KOKUYO decided that this is an issue it must solve since it
has been involved in work styles in Japan for many years.
The starting point was the establishment of the Innovation
Center in 2014. The Innovation Center aims for the

The seat sways 360 degrees in all directions, enabling

development of innovative new products with future potential

the person to keep moving while sitting on it.

that can be differentiated from other companies' products,
preventing them from getting pulled into price competition. In addition, the Center works toward monozukuri that is notmarket-driven (merely responding to customer expectations) but product-driven (exceeding customer expectations andbetraying them in a good sense).
Based on these concepts, the "ing" was developed through an unprecedented number of trials and errors over a periodof approximately four years. Based on the viewpoint that the essence of the problem is not sitting itself, but maintaining
the same posture for a long time, we created an innovative chair that keeps the person healthy even while sitting on it bydrawing out body movements to revitalize the body and the brain.
KOKUYO has long worked to create innovations from a variety of aspects, including technology and design. The "ing" isa product that once again demonstrates KOKUYO's potential and its inherited DNA both inside and outside thecompany. The "ing" could lead to an innovative new stage of work style reform. By utilizing the "ing," we hope toinnovate how people work and make the Japanese working environment more comfortable.
* For details, please visit the "ing" website.

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Third-Party Assessments"Think of Things" Opens as a New Point of Contact with Customers
On May 26, 2017, a new KOKUYO facility opened in Sendagaya,
Tokyo. On the first floor is the "Think of Things" lifestyle shop andcaf?, stocked with products that can be considered tools to
produce stimulation and discoveries in both daily life and work.
The second floor has a studio and the third floor is provided with
offices. In this stimulating environment where people seeking newvalues can congregate, a variety of experiments will be initiatedthrough products, service, events, etc.
We plan to use this new facility as a platform where, by having
direct exchanges with end users, we will be able to actuallyexperience customers' taste and trends and think about andUnder the theme of "Crossing the boundary between

create values that KOKUYO can provide for the future.

work and private life," the shop promotes tools that can
produce stimulation and discoveries in both private life
and work.

The Work Style Research Institute, which Suggests Future Work Styles from a UniqueViewpoint
KOKUYO's Work Style Research Institute continues to suggest
necessary new work styles for offices from a unique viewpoint, by
sensing changes in work styles early on. Its official website
opened in July 2017, strengthening information dissemination.
The website also features unique work-style-related content,
including a report on "walking meetings," which all famous
executives and politicians are said to be practicing, as well as
KOKUYO's unique work value diagnostic tool "#workTag." TheLaboratory's goal is to materialize undiscovered work styles thatwill bring change to the marketplace by collecting information andconducting research from the viewpoint of "How much enjoyment

Official website, which introduces the activities of the

can workers derive from their work and does it enrich them?"

Work Style Research Institute and their results tocustomers* For details, please visit the Work Style Research Institute's official website.

NEOS Series Creating New Office Standard for Files
Sixty years have passed since flat files were invented in 1956.
KOKUYO's files have undergone many changes in response to
the needs of the times. The NEOS Series, launched in 2017 as a
new standard file series, is characterized by a variety of colors
that can be coordinated with office furniture, which was previously
not possible. In addition to a high degree of design freedom, theevolution in functionality conceived for the series as a wholemakes the NEOS Series the ideal tool for creating a workerfriendly and beautiful office space. We will continue to work on

Refined color line-up to create office spaces with adeveloping products that can demonstrate KOKUYO's uniquenessvariety of concepts

by capitalizing on our unique strength of being able to design stationery and furniture as a set.
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Work Style Reform EXPO to Promote Work Style Innovation through Sound Environment
Improvement
KOKUYO Engineering & Technology Co., Ltd., which provides
office relocation services, exhibited at the Fourth Work Style
Reform EXPO. The goal was to promote sound solution and gain
contact points with highly promising users who are seriously
thinking about work style reform.
Sound solution is a technology for improving the workerfriendliness of workplaces by improving sound environments. A
sound-masking system is a representative product that is effectivein ensuring speech privacy. At the venue, visitors were able toexperience sound masking using virtual reality, making the Expoan excellent opportunity for promoting sound solutions, which areSound masking for experiencing a 360-degree view withnot yet well known in Japan.

sound using VR, which became the centerpiece of theexhibit"Hakokatsu" Initiative to Encourage Reuse of Empty Copy Paper Boxes
The Hakokatsu project is a company-wide initiative of Kaunet Co., Ltd., which sells office products through the web or
fax. We redesigned the outside box for copying paper so that it could be reused by customers when the box was empty.
To better accommodate the storage and shipping applications indicated by many customers, we left as wide a space aspossible on the box for describing its stored content. This size can accommodate multiple labels. We also provided aspace on the box top where a shipping label could be pasted.
Following the redesign, we have been promoting wider utilization by publishing a booklet summarizing reutilization
examples. We also held a campaign to encourage customers to submit their utilization methods so as to create highadded values to differentiate our products from competing products.

Hakokatsu design based on the concept of ease of reuse

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Implementing work style reforms:Commencing Business at the Tokyo Shinagawa SST
OfficeIn October 2017, KOKUYO established and moved its operationsin the Tokyo region to a new office; on October 2, business
commenced at the Tokyo Shinagawa SST Office.
The goals of the move were the re-centralization and optimizationof our management resources, efficiency improvements, and theestablishment of a new work style suited to KOKUYO. For sometime now, the company has been working hard to develop avariety of new products and design a range of business spacesthat would contribute to work style reforms at its Japanese offices.
In order to take our initiatives one step further and foster a
corporate culture that draws out value from our employees, weestablished the Tokyo Shinagawa SST Office.
The new office locates all departments on a single floor. By
removing both physical and psychological barriers between
different departments to ensure smooth communication andenhanced collaboration, the office is designed to improve
workplace productivity. With the exception of staff who require
specialized terminals for their work, for example, the office
operates a system where employees are free to change desk. We
hope that by changing where they sit on a daily basis and thereby
expanding their observable world, employees will be encouraged
to have new realizations and ideas, and that inter-staff
communications will improve. Of course, we realize that establishing a new office will not solve all our problems in one
go. However, we firmly believe that the experience of thinking about, trying out, and implementing such work stylereforms ourselves will lead to suggestions beneficial to our customers.
Location: 18th Floor, Shinagawa Season Terrace,
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KOKUYO Group History

KOKUYO s CSR

Customers

Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Respect for Human Rights

To bring out the motivation and creativity of our employees, KOKUYO is making efforts to change goal setting andevaluation systems and methods in the Personnel System.

Creating an Environment that Facilitates the Growth of Each Employee
The KOKUYO Group is promoting the development of mechanisms and environments where capable and enthusiastic
employees can play an active role in the workplace, and where they are appreciated for their performance
regardless of nationality, race, gender, age, religion or academic background.
In addition to these measures, we are undertaking operation model reforms as part of our medium-term management
plan, "Self-reform focusing on value creation -Value Transformation 2018," which was started in October 2015. These
reforms focus on realizing customer-orientated value creation with the goal of eliciting changes in the relationshipbetween people and the company, as well as encouraging the motivation and bringing out the creativity of ouremployees.
[Three approaches that will bring about changes in the relationship between people and the company](1) Changes to the goal setting system(2) Changes to the evaluation system(3) Clearer reflection of evaluation in employee treatment
In support of this medium-term management plan, we are working to build a goal-setting system in whichthat enables
each employee canto better understand the purpose of making effortgoal that they are working toward.
In the previous commitment-style communication, in which supervisors unilaterally communicated goals, these goals
tended to be unmovable, leaving employees unable to fully understand them. Under the new system, we are switching
to consensus-style communication, where supervisors and subordinates repeatedly discuss why this high priority theme
should be addressed and what goal they want to set for themselves.
Managers and members of top management also hold workshops related to goal setting to share information such as"what has just been achieved" and "what was able to be reformed," in order to gain a better understanding of the issues
related to setting goals for the next term. We will continue promoting efforts to more fully establish this new goal-setting
system.
For the evaluation system, we switched from relative evaluation to absolute evaluation, which gives a clearer view of
how evaluation is reflected in compensation. This switch now allows each employee to define the specific results to beachieved when setting goals, i.e., what has to be accomplished by when and to what degree. Then, evaluation andcompensation are determined based on how fully the employee has achieved the set goals.

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The First Joint Sports Day Held with Employees and Family Members of
KOKUYO Group Companies in China

KOKUYO Group has been actively expanding its business in the rapidly growing Asian market, particularly in
China, where many Group companies are conducting business. With the goals of promoting internal exchange
among Group companies in China and improving employee morale, the KOKUYO Group Companies in China
gathered together and held their first joint sports day, the "2017 KOKUYO China Happy Carnival", on October 28,
2017. On the day of the event, a total of nearly 400 people, comprising employees of KOKUYO Commerce(Shanghai) Co., Ltd., S&T Logistics (Shanghai) Co., Ltd., KOKUYO Design Consultants (Shanghai) Co., Ltd.,KOKUYO Furniture (China) Co., Ltd., and KOKUYO (Shanghai) Management Co., Ltd., along with their family
members, gathered at the Shanghai Huangpu Gymnasium beginning in the early morning. The participants weredivided into eight teams and enjoyed various games.
At the opening ceremony, following a video message from the Head Office, expatriate employees from Japan led
all of the participants in a warm-up exercise to mark the start of the event. In addition to a team relay, a tug of war
contest, and a parent-child game, the event also included all sorts of original games featuring KOKUYO furnitureand stationery products, such as a relay transporting various types of KOKUYO stationery products, an office chair
race, and a true or false game to test one's knowledge of KOKUYO-related information.
This first joint sports day turned out to be a very memorable experience for everyone, with many employees andfamily members participating, and all participants playing and laughing together. The type of communication that is
not possible in the workplace was achieved. For example, team members cheered on or helped each other,making the event a great opportunity for strengthening bonds among KOKUYO Group Companies in China.

Staff members in cartoon-character costumes handed out toys to the children. A play area for children was also set up so that family
members could also enjoy the event.

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Corporate Activities

Respect for Human Rights

Third-Party Assessments

Relay transporting various types of KOKUYO stationery products. Each player had to complete the entire process, from picking,packing, shipping, packaging, and delivery.

Communication with Employees

Sports Day and Appreciation Gathering at KOKUYO Product Shiga Co., Ltd., which is Aiming
to become an "Enjoyable" Company
As part of its initiatives to become an "interesting company,"
KOKUYO Product Shiga Co., Ltd. held a Sports Day andAppreciation Gathering on April 28, 2017. The purpose of theevent was not only for the employees to have a good time
together, but also for them to gain a sense of camaraderie by
joining together outside production activities as well. Planning andpreparation for the event were carried out mostly by younger andmid-level employees who had attended the second leader training
the previous fiscal year.
The event was attended by approximately 150 people, including
the employees of KOKUYO Product Shiga, as well as employeesof other KOKUYO Group companies. The participants competed

The event was held with the goal, "Let's enjoy working
together as colleagues!"

in a total of six games, including some original ones. After that, part-time workers and employees of silver humanresource centers who could not attend the Sports Day joined the evening Appreciation Gathering, making it a banquet
with full participation.

Two Friendly Get-togethers Held at KOKUYO Stationery Factories in JapanOn May 26, 2017, KOKUYO Product Shiga Co., Ltd., KOKUYOMVP Co., Ltd., and WAMI Paper Industry Co., Ltd. of the
KOKUYO Stationery (ST) Group gathered for an Issue-Sharing
Meeting. The content to be discussed in the meeting was
negotiated and decided in advance during a video conference.
The purpose of the recent meeting was to encourage participants'
awareness by sharing information and exchanging opinions about
issues facing the ST factories in Japan so that the results could be
utilized in the participants' activities.
Then, on May 27, a friendly softball tournament was also heldamong three teams in the KOKUYO Association, formed primarily
with members of KOKUYO Product Shiga, KOKUYO MVP, andST Department . The plan is to actively promote opinion exchange
and interaction within the group in order to together create

A total of 30 employees who came together again for
the first time in three years exchanged opinions on thefollowing four themes: safety, preventive maintenance,
improvement/education, and production control
operation.

standards for the ST production factories.

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Third-Party Assessments

Furniture Business Division Unity-Strengthening Meeting to Promote Knowledge,
Interchange, and Unity
To integrate its value chain more strongly, the Furniture Business
Division has since 2012 been holding unity-strengthening
meetings, where all members involved in the business gather
together, with the goal of promoting interchange and unity acrossdepartmental boundaries. This year's meetings were held from
July 25 through September 12 in Tokyo, Osaka, Mie, andShibayama.
For the main event, the "That's Great! Award," a furniturebusiness commendation system, model employees and teams
that made impactful contributions or achieved great results wereselected, and an awards ceremony was held to honor individuals
and business departments. We believe that setting up

Capital Region High-Demand Period Loading Capacity
Improvement Team, which won the Good Job! Award inopportunities to highlight individual employees working on thethe Business Category of the That's Great! Award 2017

front lines in this way will strengthen unity and interchange throughout the entire business division.

2017 KOKUYO Memorial Service for Deceased Employees
When the KOKUYO Group marked its 70th anniversary in 1974, amemorial monument for deceased employees was built on Mt.
Koyasan at the suggestion of the late Shonosuke Kuroda,
honorary chairman. A memorial service has been held every year
since to enshrine the spirit of employees who passed away in theprevious year in order to show appreciation for the predecessors
who contributed to the development of the KOKUYO Group.
At the 2017 KOKUYO Memorial Service for Deceased Employees
held on August 21, 2017, following a Buddhist memorial service
conducted at the main hall of the Tentokuin temple, the service
moved to the Daireien cemetery at Mt. Koyasan, where a

The memorial service attended by KOKUYO Vicememorial service for deceased employees was held in front of the

Chairman Yasuhiro Kuroda, along with bereaved family
members

KOKUYO Memorial Monument for the Deceased. An enshrining

ceremony was then held in which thin wooden boards bearing the names of the deceased were placed in the memorial
monument. Note that 14 people were enshrined in FY2017, and the total since 1974 has reached 600.

"What I'd Like to Be" Office Plans Events, such as Female Employee Training
The "What I'd Like to Be" Office, which aims to ensure diversity
promotion and the advancement of women at KOKUYO Logitem,
again planned a variety of training sessions and events in 2017.
On September 12, the fourth "What I'd Like to Be" meeting, aworkshop targeted at female employees, was held in Nagoya.
Then on October 11, the What I'd Like to Be" Office sponsored its
first project, an area event called "KOKUYO Product Shiga Plant
Tour". In addition, from August to September, a participatory
activity suggested by the Office was also carried out, in whichrefreshing, damp washcloths were distributed to drivers who wereloading or unloading cargo.
From now on, the Office hopes to plan new events to promote

Ms. Sayaka Otaki, a yoga instructor, giving a lecture atthe "What I'd Like to Be" meeting

diversity from a variety of viewpoints.
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Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments"Shunjukai" Retirement Ceremony for Employees Approaching Mandatory Retirement
This retirement ceremony is to celebrate the retirement of
employees of the KOKUYO Group who are approaching
mandatory retirement, in appreciation of their many years of hard
work. The ceremony is held twice a year, once each in the firstand second halves of the fiscal year. In FY2017, 32 and 43
employees were included in the first- and second-half ceremonies,
respectively.
During the ceremony, after the company song was sung in unison,
Chairman Kuroda presented each retiring employee with a list ofcommemorative gifts. During this presentation, what KOKUYO
underwent in the year each employee joined the company wasdescribed. In addition, recollections about life at KOKUYO written

Commemorative group photo taken in front of theportrait of founder, Zentaro Kuroda

by the attendees themselves and the message that they wished to convey to younger generations of employees werealso read to express appreciation for their many years of effort and contribution.

Family Day for Expressing Appreciation to Family Members Held in Shinagawa and Osaka
The Stationery Business Division holds its Family Day to provide
an opportunity to show appreciation to family members who
regularly support its employees. Family Day 2017, which marked
the 10th year the program was held, was attended by 191 and198 employees and their family members in Osaka andShinagawa, respectively.
The event is planned by project members consisting of mid-careerhires, young employees who have been with the company
between one and two years, and others recommended byindividual divisions. This year's event focused on helping family
members to broaden their understanding of KOKUYO. Exploration

Happily exploring the showroom while answering

tours were held, using the historical material room in Osaka andquizzes about KOKUYO products

the showroom in Shinagawa, providing opportunities to come into contact with KOKUYO's history and products.

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Environmental Conservation

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Respect for Human Rights

Participation in Telecommuting Day with the Goal of Achievinga Balanced Work Style

As part of the citizen's movement toward work style reform, the Japanese government designated July 24 eachyear through 2020 as Telecommuting Day. Participating in this movement, KOKUYO also conducted a trial of
telecommuting on July 24 (in the Tokyo area) and August 8 (in areas other than Tokyo).
Employees wishing to try an autonomous work style were encouraged to apply for authorization and approximately
160 people participated. Each of these employees tried out telecommuting, flextime, etc., experiencing a new work
style, such as effectively utilizing commuting time or working in a space different from the usual work environment.
A survey following the trial returned many positive responses, such as "I was able to increase my productivity," "I
was able to spend my time more purposefully," "I want to utilize it again in the future." On the other hand, however,some employees experienced lower productivity because of the type of work involved or the home network
environment, reconfirming issues that must be addressed when promoting telecommuting.
KOKUYO has so far established the physical environment for telecommuting by, for example, introducing atelecommuting system with the goal of supporting employees wishing to continue working while caring for a childor sick family member, and also introducing ICT technology on a trial basis. Through these steps, we haveincreased the level of knowledge necessary for promoting work style reform. Taking into consideration the resultsof the recent Telecommuting Day initiatives, we will continue to utilize a variety of methods in striving to develop
new, more balanced work styles.

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Joint Labor-Management Initiative to Reform Work Style
To achieve balanced work styles, we consider it to be important to reform both our systems and mindset. Therefore, ourlabor and management are working together to promote the following initiatives:
・Ensuring that all employees understand the systems and rules (holding attendance rule study meetings and individual
consultations about the telecommuting system)
・Promotion of "Plus 3 Vacation Days" (taking an additional three paid vacation days a year)
・Creation of a transparent workplace culture (improving the workplace utilizing employee surveys)

Support of the "Bring Your Child to Work Day" Organized by College Students
KOKUYO cooperated with the "Bring Your Child to Work Day" organized by college students and sponsored bymanma*. This project was developed based on manma's vision of having society as a whole participate in rearing
children, as well as the wishes of parents in families with two working parents to have their children experience life
outside of school during spring break. KOKUYO supported this project because we agree with manma's vision, and also
because the project can become part of our initiatives to support employees who are working while raising children.
On the day of the event, the 15 elementary school children who participated, five of whom were KOKUYO employees'
children, tried out a variety of programs in the KOKUYO office. This recent initiative provided the employees' children
with an opportunity to better understand the company that their parents work for and what they do.
* manma is an organization founded by female college students with the goal of providing young people with opportunities to holisticallydesign their careers also taking into account such issues as marriage and child rearing. The organization holds its "Taste Life as a Working
Parent" program and exchange events between college and elementary school students on a regular basis.

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Regional Communities

Environmental Conservation

Corporate Activities

Respect for Human Rights

Third-Party Assessments

Respect for Human Rights

We are implementing initiatives that can maximize the motivation and ability of each individual employee as we seek tobecome a company where all employees, from new employees to management, constantly learn and progress.

Policy of Human Resource Development
The KOKUYO Group is promoting systematic individual development centered on three elements - job site, feedback,and training - with the goal of maximizing the individual value of each employee. Training is given mainly by profession
at each turning point for businesspersons to provide them with different opportunities to develop their potential throughtraining for selected employees and optional training, offering strong support for employees willing to accept suchchallenges.

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Human Resource Development Program

Product Training that also Serves as a Platform for Intergroup Exchange
KOKUYO Logitem Co., Ltd., which is responsible for logistics,
holds product trainings targeting employees engaged in backoffice administration or sales at KOKUYO Marketing Co., Ltd.,
which is responsible for sales and marketing. In 2017, trainings
were held in May and July.
In the training held at the Shinagawa Office in July, methods ofassembling products during delivery and the number per box andconfigurations of parts necessary for assembly, as well as how
products are packed for delivery were explained in an easy-tounderstand manner even for employees seeing the actual items
for the first time. The points to remember when processing
purchase orders were also explained. For employees who neversee actual products, the training provided an important training
ground for improved understanding of the products. Furthermore,
the opportunity was a valuable platform for exchanges amonggroup company employees who do not normally interact with eachother and a chance to share their problems and requests.

Assembly demonstration and explanation of products
and operation procedures

Joint Three-Company Women's Seminar - Exchanges across Company Boundaries Producing
Synergistic Effects
Furniture Business Division (Engineering Department and Special
Solution Department), KOKUYO Logitem Co., Ltd., and KOKUYOEngineering & Technology Co., Ltd. held the Joint ThreeCompany Women's Seminar on July 14, 2017. The aim of theseminar was to help female employees become more motivatedand find their unique career paths by gaining a new understandingof their own strengths and values and strengths and thinking
about the significance of working.
Another goal of the seminar was to have female employees fromdifferent companies who are responsible for providing back-end
support in a variety of job categories gather in one place, motivate

The seminar in 2017, the second of its kind, was held foreach other, and consider common problems and issues together

15 mid-level and veteran female employees.

to produce synergistic effects, leading to personal growth. This goal was achieved.

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Third-Party Assessments

KOKUYO Logitem Holds First Training for Distribution Personnel
KOKUYO Logitem held its first training targeting delivery
personnel working at distribution centers throughout Japan. The
purpose of this training is to transform ways of thinking so thateach distribution employee as a KOKUYO professional on thefront line performs actions with customers in mind, increasing thevalue of the distribution section. Many employees from the
KOKUYO Group also attended the recent first training session,bringing the total attendance to almost 50.
In the training, Mr. Teruo Yabe*, President of Omotenashi
Company , was invited as a guest lecturer, and activities such asgroup discussion were held. This provided the attendees an
excellent opportunity to reassess their work from the customer's

During the group discussion, attendees discussed what
they could do to please customers.

perspective. Improvement activities will continue in the future as the training is expanded to distribution centersthroughout Japan.
* Mr. Yabe transformed East Japan Railway Company's bullet train cleaning team into a hospitality team. For his initiative and achievement,
Mr. Yabe received recognition for a well-managed hospitality company from Japan's Ministry of Economy, Trade and Industry and theService Hospitality Award Special Prize from the Japan Institute of Information Technology.

Open Challenge Program that Expand Visions through Interactions with Human Resourcesfrom Different Industries
The Open Challenge Program (hereinafter referred to "OCP") is across-industry exchange training program that the KOKUYOGroup has been participating in. Employees within the Group are
invited to participate voluntarily.
The aims of the OCP are the expansion of visions (to becomeaware of their own potential); acquisition of knowledge, skills, andmindset required for future career formation; and meeting new
people (building of external network).
The secretariats of participating companies give opinions andcarefully choose the high-quality program. A questionnaire of theparticipants revealed high results for satisfaction.
Great benefits of this program include coming into contact with values that are different from those of KOKUYO inparticular, and interacting with human resources from different industries. It is a good opportunity to form valuable
personal connections.

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Environmental Conservation

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Third-Party Assessments

Respect for Human Rights

KOKUYO believes that creating a safe, secure and pleasant working environment, health management of theemployees, and safety measures in times of disaster are the foundation for employees to work vigorously anddemonstrate their full abilities. We establish systems and structures while actively exchanging opinions with employees.

[Basic policy]
Safety First!
The KOKUYO Group promotes safety-related activities because it regards the health and safety of each
employee's mind and body as the foundation of its business.
[Code of conduct]
1. Comply with all relevant laws and regulations, including those related to the Industrial Safety and
Health Law, as well as internal guidelines and standards.
2. Encourage continuous and autonomous workplace improvement, and strive to prevent occupational
accidents and health problems.
3. To ensure the safety and health of everyone involved in the Group's business, promote the creation ofa transparent culture in which everyone participates.

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FY2017 KOKUYO Group Construction and Factory Safety and HealthConferences was Held

As people all over Japan were thinking about the importance of safety while marking the 90th annual National Safety Week*(the first week of July), the KOKUYO Group also thought about safety at all of its locations throughout Japan and held its
Safety and Health Conference with the goal of raising awareness.
● [Construction] FY2017 KOKUYO Group Construction Safety and Health ConferenceWith a belief that the safety and health of its employees and partners constitutes the foundation that supports company
growth, the KOKUYO Construction Safety and Health Promotion Committee set its FY2017 goal as: "The KOKUYO Group
companies shall aim to boost further safety awareness and fully establish and enhance an autonomous safety culture". At
various regional conferences, employees and partners shared this goal, reaffirming their commitment to keep working
together. The events at seven venues throughout Japan included an opening address by Vice Chairman Kuroda, the chair of
the Central Safety Health Committee, speeches by the representatives of the various regions, an activity report by theConstruction Safety and Health Promotion Committee, and formal recognition of partners.
● [Factories] Safety and Health Conferences and Safety Patrol at KOKUYO Group factories in Japan
Safety and health conferences, as well as safety patrols, were held at five plants in seven locations in Japan. At the safety
and health conferences, as part of the initiatives to create transparent workplaces, a letter of appreciation was presented to
employees recommended by executives at various work locations, and a lecture was given by the editor-in-chief of the
Safety and Disaster Prevention Manual.
Each of the safety and health conferences for construction and factories included innovative content to prevent safety
awareness from becoming a mere slogan. In order to pass our safety-protecting culture onto future generations, we willcontinue to provide opportunities on a site-by-site basis within the entire KOKUYO Group to pause every year and think
about safety.
*National Safety Week aims to promote voluntary health and safety activities in the industries, to enhance public awareness concerning
occupational safety and to ensure the firm implementation of safety activities advocated by the Ministry of Health, Labour and Welfare
and Japan Industrial Safety and Health Association.

Formal recognition of partners who had performed safe, efficient,and high-quality work at delivery locations or factories in various
regions. (This photo was taken at the Kanto Area Conference.)

Safety patrol

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Basic Concepts
The KOKUYO Group is promoting safe, secure and pleasant working environments while encouraging active exchangeof opinions with the workplaces, as they are vital to smooth business operations.

KOKUYO Group Health Targets and 2017 Results
The KOKUYO Group has been promoting health activities by collaborating with the in-house Health Insurance
Association and Health Management Office in setting specific health goals from 2013 in order to prevent lifestyle-relateddiseases.
We have carried out a walking campaign to encourage the habit of enjoyable exercise in which employees record daily
the number of steps taken and their weight, and have also held healthy eating seminars in collaboration with publichealth centers. Moreover, as cancer prevention measures, we installed mammography systems so that examinations
can be performed during regular in-house health check-ups, to promote having medical examinations for breast cancer
and colorectal cancer. Furthermore, we have actively enhanced health check options. For example, we now allow
employees to undergo complete medical check-ups if desired, and have created opportunities for employees to benefit
from medical examinations and increase their health awareness.
KOKUYO Group data

Percentage of employeeswith a BMI over 25
Percentage of employees
who smoke (from Q&A data)

2013

2014

2015

2016

2017

21%

23%

23%

23%

24%

26%

26%

27%

26%

26%

Specific Steps We have Taken in 2017
1) Implementation of health campaign
It was the fourth year of the walking campaign that is held jointly by KOKUYO and KOKUYO Health Insurance
Association for all employees. This health activity, called the GG campaign, is based on the concept of "enjoy becoming
fit and receiving rewards!" Each employee self-reports the number of steps they have taken daily, and those whoachieved their goals receive seasonal fruits. We will strive to increase health awareness by continuing this activity, forwhich the number of participants is increasing every year.

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Third-Party Assessments

Number of participants of the GG campaign

Participants

2014

2015

2016

2017

340 person

670 person

853 person

923 person2) Infection control measures
In order to reduce the risk of severe illness, we are expanding the opportunities (places) to have flu vaccinations within
the company. The Health Insurance Association also offers subsidies, making it easier for employees to get
vaccinations, even at clinics outside the company if desired.
We also have gargling solution and masks available at each worksite, and are utilizing posters and company-wide
e-mail messages to consistently carry out activities to raise awareness about disease prevention and prevent the spreadof communicable diseases.
Number of people who had vaccinations

No. of people receiving
vaccinations

2014

2015

2016

2017

2,487 person

2,749 person

2,852 person

2,630 person3) Mental health initiatives
Since 2016, we have been conducting stress checks based on laws and regulations.
In order to establish a system where each employee can receive self-care without hesitating, we are making anenvironment where we can support prevention at an early stage by introducing the EAP (Employee Assistance
Program) operated by an external institution to make the employees notice the burdens that they feel.
Additionally, we conduct comprehensive employee surveys related to work engagement, employee satisfaction (ES),and compliance awareness as workplace health markers.
Of the survey results, the items related to workplace culture in particular are collated with data on hours worked. The
findings are then utilized as opportunities, tools, and KPIs for workplace improvement and incorporated into worksiteoriginated activities.

Labor Practices/Safety and Health
KOKUYO Group Factory Get-together for Safety Managers from the Five Factories in Japan
Believing that the health and safety of its employees are thefoundation of company growth, KOKUYO Group is taking safety
and health management initiatives from a variety of perspectives.
In FY2017, we held a get-together event on October 26 bringing
together managers engaged in health and safety activities at thefive factories in Japan (Mie Factory, Shibayama Factory, KOKUYO
Product Shiga Co., Ltd., KOKUYO MVP Co., Ltd., and IWAMI
Paper Industry Co., Ltd.). The participants carried out a factory
patrol, attended safety trainings, engaged in Group work activities,
and exchanged information.
By promoting cross-departmental safety and health issues atExperiencing a simulated disaster in a safety laboratory

individual business groups, such as factories, construction
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Third-Party Assessments

sections, distribution sections, and offices, which tend to view
issues in a more vertical orientation, the KOKUYO Group Central
Safety Health Committee strives to maintain the safety and healthof group employees and create a work environment and culturethat enable employees to work vigorously and demonstrate theirfull abilities.

Group work carried out focused on the emergency stop
buttons of machines

Presentation on Forklift Accident Elimination Initiative at the National Industrial Safety and
Health Conference
The 76th National Industrial Safety and Health Conference washeld recently in Kobe (sponsored by the Japan Industrial Safety &Health Association), providing an information exchange platform
for people involved in safety and health activities to present
improvement examples and research results. Shigeki Mori, asafety manager at KOKUYO Shibayama Factory, made apresentation at the Conference on forklift accident elimination
measures being taken at the Factory.
The Shibayama Factory experienced a total of eight property
damage accidents caused by forklifts in 2012. Recognizing thecauses of these accidents as issues that could lead to serious
disasters, the Factory started forklift accident elimination activities.
Past accidents were analyzed and sorted into various causes, i.e.,management, behavior, condition, and training problems, andMr. Mori's presentation titled, "Forklift Accident
Elimination Activities: Improvement through Innovative
Steps", was presented before an audience of more than
500 people

improvement activities were implemented. In this way, the Factory succeeded in completely eliminating forklift-caused
accidents in 2016, and has continued improvement activities into the present.

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Respect for Human Rights

The KOKUYO Group promotes diversity as an essential initiative for sustainable growth and development. We are taking steps
with the belief that diversity means creating a work environment where many positions and values are mutually recognized andvarious work styles are permitted, thus making it possible for each and every employee to draw on his or her innate abilities.

Heartland Co., Ltd., a Pioneer in Hiring People with Disabilities,
Marks its Tenth Anniversary

Heartland Co., Ltd. was started as Kokuyo's second special
subsidiary* following KOKUYO K Heart Co., Ltd. It is the first
special agricultural production subsidiary in Japan. The company
grows salad spinach using hydroponics and has received a great
deal of attention from both inside and outside KOKUYO as apioneer in hiring people with intellectual or physical disabilities
and expanding the range of jobs available to them. Since its
operation start, 4,200 people have visited the company, and7,500 people with disabilities a year (a cumulative total of 70,000
people) have been received from outside institutions based oncontractual agreements that allow people with disabilities to work
President Tani giving a lecture at an employment
and get paid on a piecework basis. In this way, Heartland isdevelopment forum
making a social contribution, in addition to hiring people withdisabilities as its own employees. More recently, the company
has been drawing national attention as a pioneer in "agriculture-welfare collaboration" for its goal of achieving an inclusive
society by solving the agricultural labor shortage by employing people with disabilities. Heartland is also carrying out othervarious activities, for example, multiple major users of the Furniture Business Division came to tour the Heartland facility.
In addition, Heartland personnel appeared as panelists at various types of lecture-style meetings and acted as instructors
at an agriculture-welfare collaboration project contracted from the Osaka prefectural government.
In October 2017, Heartland marked its 10th year of operation with an anniversary party attended by many people,
including current Heartland employees. Others who attended included people and organizations that had been
involved in establishing Heartland, as well as people currently involved, such as previous employees, KOKUYO
personnel who were involved in establishing Heartland, Osaka Prefectural Corporation for Agricultural Land
Development and Greenery-Environment Promotion, Sennan City, and employees from facilities that hire persons
with disabilities. As its next challenge, Heartland is currently trying to grow new vegetables such as coriander andkale, and plans to keep taking on new challenges as a pioneering special subsidiary.
* A special subsidiary is a subsidiary that makes special arrangements for hiring people with disabilities and is counted as one of theparent company's business sites in calculating its rate of hiring people with disabilities.

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Basic Concepts
Basic Framework for Diversity
We believe that diversity means creating a work environment where many positions and values are mutually recognizedand various work styles are permitted, thus making it possible for each and every employee to draw on his or her innate
abilities. KOKUYO has identified the following four basic themes related to diversity:

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Establishment and Penetration of Support Systems
The KOKUYO Group is working to make improvements in its systems to create an environment where it is easy to get agood balance between work and life, such as bearing children, raising them, and caring for senior family members. (Theparts underlined are beyond the range of statutory provisions)

Statutory system for the purpose of child-rearing and nursing-care support*
Maternity leave

Six weeks before childbirth (14 weeks for multiple-birth pregnancies) and eightweeks after childbirth

Spousal maternity leave

A leave of absence granted when a spouse is giving birth. Two days for eachchildbirth.

Childcare leave

Sick/Injured childcareleave

A childcare leave is given until the day the child reaches the age of two. (For achild born in April, childcare leave is given until the end of April in the year the childreaches the age of two.)
Up to 5 days per year, or 10 days for two or more children, to look after a childbelow school age. (Can also be obtained in half-day units)

Family care leave

Up to a total of 183 days for each person requiring nursing care. (Can be taken in
up to 3 blocks)

Nursing care leave

Up to 5 days per year per person requiring nursing care, or 10 days for two or
more. (Can also be obtained in half-day units)

Short working hour system

Teleworking

Childcare: Until child finishes their third year in elementary school.
Nursing care: Up to three years per person requiring nursing care.
Can be taken in 1-day units (up to 52 times in one year) or hourly units
Childcare: Until child finishes their third year in elementary school.
Nursing care: Up to three years

Re-employment system

Eligible personnel include regular employees who left their jobs due to marriage,
child-bearing, childcare, job relocation of spouse, study abroad, volunteer work,
career change and other reasons recognized by the company※The system is applied to KOKUYO and its principal subsidiaries (In principal, all employees are eligible for flextime work schedule.
Flextime system without a core period introduced)※Related information: "Number of Employees Taking Leave for Childbearing and Senior Care"109

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Third-Party Assessments

Achieving a Good Work/Life Balance
The KOKUYO Group is committed to providing ideal working conditions
withconsideration for achieving a good work/life balance. These efforts havebeenrecognized by the government and four of the group companies have received
acertification logo (nickname: Kurumin Mark) as of December 31, 2017.
The KuruminMark is a certification logo issued by the Ministry of Health, Labour andWelfare, whichpromotes the improvement of the nation's declining birth rate, based on
the Law forMeasures to Support the Development of the Next Generation, torecognizecorporations and organizations taking an active stance in supporting childraising.
[Companies that received the Kurumin Mark] As of December 31, 20176
KOKUYO Co., Ltd., KAUNET Co., Ltd.,KOKUYO Marketing Co., Ltd., KOKUYO Engineering & Technology Co., Ltd.

Introduction of Teleworking System and Flextime System without a Core Period
KOKUYO has introduced a teleworking system on a daily or hourly basis for employees who have restrictions on time
orplace due to child rearing or nursing care. The system allows employees to engage in both child rearing and work byusing their spare time efficiently, such as the time before leaving to work in the morning or the time after finishinghousework until going to bed. Therefore, the number of employees utilizing this system is increasing.
Furthermore, we aim to improve work-life balance and realize higher productivity byintroducing a flextime system withouta core period and making working hours flexible.

Cross-industry Initiatives
We strive for collaborations that go beyond industry boundaries in order to promote diversity.

KOKUYO has participated in the Iku-Boss Project Alliancesponsored by Fathering Japan since it started in December
2014.
In order for organizations to maximize the abilities of
employees, management must understand that employees have time constraints due to factors such as
childcare, care for elderly relatives and illnesses, and it is essential for the management to change their
way of thinking. By participating in the Iku-Boss Corporation Alliance, participating advanced corporations
with the same awareness of challenges can share their knowledge to make it an opportunity to reconsider
their diversity management as well as working style and workplace climate. In addition, by considering
the image of ideal supervisors (Iku-Boss) in the new era through the collaboration of corporate networks
with the aim of developing further, KOKUYO strives to use it for the solution to challenges held bycustomers as a corporation that suggests new working styles.

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KOKUYO participates in the Diversity Western Japan Workshop, in which about 50 companies locatedinthe Kansai region gather to share information and establish networks. Diversity promotion managers
fromvarious companies gather and exchange opinions on themes such as reforms in the way of working,support for disabled people to take active roles, and support for a balance between work, child careandnursing care, and we make use of what we have learned in our own companies.

For the purpose of making a working environment where each and every employee can play an activerole, four companies with the same awareness of issues established a group to consider the ideal way ofworking.
In 2017, a cross-industry interchange was held, designed to help male employees think about work styles
that enable both them and their partners to thrive at work.

KOKUYO K Heart Co., Ltd. Aiming to be a Pioneer in Hiring Persons with Disabilities
KOKUYO K Heart was started in 2004 with the goal of hiring
persons with disabilities within the KOKUYO Group. The company
is currently playing the role of a supporter of the KOKUYO Group,
and all of its employees, including persons with no disabilities,
seniors, and persons requiring mental health care, are working intheir full capacities in various suitable positions.
The Act for Promotion of Employment of Persons with Disabilities
was amended in April 2018, in which the legally required
employment rate for people with disabilities was increased to
2.2%. In response, KOKUYO K Heart has been working withKOKUYO's business divisions to create job opportunities and hire
KOKUYO K Heart is actively expanding its businessmore people with disabilities, and is now confident about reaching
scope. The photo shows the Stationery Development
the 2.2% goal. Also keeping future amendments* in mind,
Section.
KOKUYO K Heart is aiming to remain a pioneer in hiring people
with disabilities by breaking down the stereotypical view that"people with disabilities can handle only simple tasks" and creating job opportunities for employees who have various
disabilities.
* The April 2018 amendment of the Act for Promotion of Employment of Persons with Disabilities will raise the legally required employment
rate for persons with disabilities to 2.2% for companies with 100 or more employees. The rate is then expected to rise to 2.3% by March
2021 and 2.5% by April 2023.

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Environmental Conservation

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Third-Party Assessments

Commendations

KOKUYO Recognized under the 2017 Certified Health and Productivity Management
Organization Recognition ProgramBecause of its initiatives addressing health issues and promoting
health, KOKUYO was one of the organizations recognized in the2017 Certified Health and Productivity Management Organization
Recognition Program* by the Ministry of Economy, Trade andIndustry, which officially recognizes large corporations andsmall/medium-sized enterprises that are practicing particularly
excellent health and productivity management.
KOKUYO was selected because it set employee health goals in2013 and has been promoting various activities in collaboration
with its in-house Health Insurance Association and HealthManagement Office, in order to help its employees achieve

In FY2017, the first year of the program, 235

resistance to lifestyle diseases. Additionally, KOKUYO has beenorganizations were recognized under the large
enterprise category (White 500) and 95 organizations

expanding industrial health staff working at its HealthManagement Office. It has also established a follow-up system
and is working to reduce the risk of diseases becoming more

under the small and medium-sized enterprises (SME)
category.

severe by digitalizing and analyzing health checkup result data. In the future, Kokuyo plans to expand the activity scope
to cover the entire Group in sponsoring health-promoting activities.
* The goal of the 2017 Certified Health and Productivity Management Organization Recognition Program is to help establish an environmentthat highlights excellent corporations working on health and productivity management so that their employees, job seekers, relatedcompanies, financial institutions, etc. will recognize them as strategically tackling employee health management from a managerial
viewpoint.

KOKUYO-designed Office Receives Globally Prestigious iF Design Award 2017
At the iF Design Award 2017*, the Shimadzu China MS Center,designed by Naoki Sawada, the Design Manager at KOKUYOFurniture (China) Co., Ltd., received the award in the Interior
Architecture category, out of more than 5,500 entries from 59
countries around the world. Winning the award in the Interior
Architecture category, one of seven design categories, for the firsttime was a spectacular achievement for the KOKUYO Group.
The winning design achieved a concept of "showroom laboratory"
by providing both the functions of a laboratory that enables
advanced MS-related research and development by utilizing mass
spectrometry (MS) technology, and a showroom with an

Shimadzu China MS Center, built by Shimadzu
Corporation at Shimadzu (China) Co., Ltd., a group

innovative spatial design.
* The iF Design Award, given by iF International Forum Design GmbH, which

company in China

has a history of more than half a century, is one of the most famous design awards and is internationally recognized as the mark of excellent
design.

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Third-Party Assessments

Biwako Template Wins Merit Award in the 26th Stationery of the Year Award - Design Category
At the 26th Stationery of the Year Award, the largest stationery
award in Japan, the Biwako Template in the ReEDEN Series* of
KOKUYO Product Shiga Co., Ltd. was selected for a merit award.
The year's five best stationery products are selected in both the
Functionality and Design categories, and the Biwako Template
received the merit award in the Design category.
The Biwako Template makes it easier to trace and draw Lake
Biwa, the creatures living there, as well as symbols closely
associated with Lake Biwa and Shiga Prefecture. The package
paper board is made of reed grass grown in the Lake Biwa andYodo River, incorporating local characteristics with the possibility
for expansion to other regions. These factors were the reasons for(1) Can be used to easily draw Lake Biwa (as well as
Takeshima Island)(2) Can be used as a ruler(3) Comes with three functions that can be used to draw
shapes for recording trips

the selection of the Biwako Template for the award.
* The ReEDEN Series of eco-friendly stationery products were developed using reed grass grown in the Lake Biwa and the Lake Biwa andYodo River because reed grass helps to maintain the environmental health of the area by for example improving the water quality andconserving the ecosystem.

Eight KOKUYO Products Receive 2017 Good Design Awards
The Good Design Awards, a comprehensive design promotion system organized by the Japan Institute of Design
Promotion, were announced on October 4, with eight KOKUYO products receiving awards. Of these products, one
received the Good Design - Long Life Design Award, given to excellent products that have been manufactured for many
years and continue to be popular among users.
Products that received 2017 Good Design Awards(1) DAYS OFFICE(2) Working chair "cocotte"(3) Fabric screen "stripel"(4) Planner wall "RAYS"(5) Planner wall "SHIFT"(6) Laser pointer "Laser Pointer for PC" (long-life, pen type)(7) True Ruler (recipient of the KOKUYO Design Award - 2014 Merit Award)
Product that received the 2017 Good Design - Long Life Design Award(8) MP binder "Binder MP"(1) DAYS OFFICE(2) Working chair "cocotte"(3) Fabric screen "stripel"(4) Planner wall "RAYS"(5) Planner wall "SHIFT"(6) Laser pointer "Laser Pointer(7) True Ruler(8) MP binder "Binder MP"

for PC" (long-life, pen type)

Duora

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Third-Party Assessments

KOKUYO Receives the Prestigious German Design Award 2018
KOKUYO receives the German Design Award 2018, an internationally prestigious design award that is presented by theGerman Design Council, which was established in 1953 with support from the German Federal Parliament. The award is
structured in four tiers: Gold, Winner, Special Mention, and Nominee. The Gold, Winner, and Special Mention Awards
are given to excellent designs selected from nominated products. KOKUYO's "Duora" office chair received Special
Mention, and the spatial design of an office/gallery at the new headquarters of CoorsTek Inc., which KOKUYO designed,
received the Winner tier award.

"Duora" Office Chair

Office/Gallery of CoorsTek's new headquarters designed by KOKUYODAYS OFFICE Website Receives Fifth Web Grand Prix AwardAt the Fifth Web Grand Prix, KOKUYO's DAYS OFFICE* website
received the Grand Prix Award in the Corporate BtoB Site Awardin the Corporate Grand Prix category.
The DAYS OFFICE website includes a simulator function thatallows users to customize products. Customers can intuitively
select furniture that they like, find the price on a real-time basis,and purchase the desired product on the electronic commercesite. The user-friendly simulator also allows BtoB users to print out
detailed information, such as parts numbers and prices, in a
proposal document format. The recent award was given inrecognition of the high level of ease of use of the simulator

DAYS OFFICE website

function.
* This is a unique brand of furniture for configuring office space, born of the work style research expertise accumulated at KOKUYO. Placing
DAYS OFFICE furniture pieces makes it possible for anyone to achieve a comfortable space that responds to the diversity of theiremployees, without the need for cumbersome interior construction work on items such as ceilings and floors.

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Regional Communities

Environmental Conservation

Corporate Activities

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Third-Party Assessments

KOKUYO Group Wins Japan Two Wood Design Awards 2017 on the First Application
The Yui-no-Mori project* and the Protocol counters developed
through its activities both won the Japan Wood Design Award2017. The Japan Wood Design Award targets objects and actions
related to "wood," and formally recognizes products andinitiatives, etc. that are considered excellent from the three
consumer viewpoints of enriching lives, making people healthy,
and enhancing society. KOKUYO received two awards on its firstattempt.
The Yui-no-Mori project won an award in the Communication fieldof the Social Design category. The project was recognized as an
example of collaboration between a community and a corporation

Yui-no-Mori project website

taking multi-faceted initiatives, encompassing everything fromproduct and human resource development to the promotion of
lumber use and education, thereby producing secondary benefits
such as continuity and learning by participants.
* The Yui-no-Mori project was started in 2006 in Shimanto-cho, Kochi
Prefecture, with the goals of regenerating a deteriorating planted forest andrevitalizing the local community that protects it. As part of this project,
KOKUYO is making office furniture using timber from forest thinning.
Protocol counter, created using timber from forest
thinning in the Yuri-no-Mori project

Assessments
The following table lists the assessments KOKUYO received from external organizations in FY2017:12th Toyo Keizai CSR Ranking (Toyo Keizai Inc.)

Overall ranking: 236th

17th Corporate Honesty and Transparency (Ethical and Social) Survey(IntegreX)

Total score: 57th

SNAM Sustainability Index (SOMPO Risk Management & Health Care Inc.)

Overall score: 227.5

Beech Tree Forest Survey (SOMPO Risk Management & Health Care Inc.)

Overall ranking: A

CDP Climate Change

C（Awareness）

CDP Forests

B (Management)

21th Environmental Management Survey (Nikkei Inc.)

Overall ranking: 67th

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Third-Party Assessments

Third-Party Assessments

The KOKUYO Group conducts a survey on our website that asks people both inside and outside the company for theiropinions so that we can utilize the results to improve our future activities and reports. The results of our survey on the
CSR Report 2017 are summarized below. We would like to express our sincere appreciation to all those who
participated in the survey.

Attributes of those who participated in the survey

Survey results

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