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Komatsu's Environmental and Social Activities Enhancing Quality of Life

Pursuing Environmental Management  Environmental Action Plan and Results for FY2013 (Procurement and Logistics)

Green procurement

·Promote improvements at suppliers through the establishment of environmental management systems ("EMSs") and by specifying matters that require environmental consideration
Objectives for FY2013 Results for FY2013 Medium- and long-term objectives
Provide guidance and support to member companies of the Komatsu "Midori-kai" for acquiring integrated certification of their environmental management systems All subject companies acquired certification for a total of 163 certified companies, and are promoting environmental management activities Within three years, have newly admitted Komatsu "Midori-kai" admission company masters attestation of environmental management systems (ISO 14001, Eco-stage, etc.)

Environmental conservation in logistics

·Reduce CO2 emissions per unit of cargo weight generated through shipping of products and components (Komatsu manufacturing facilities in Japan) (in the scope of revised Law concerning the Rational Use of Energy of Japan)
Objectives for FY2013 Results for FY2013 Medium- and long-term objectives
Improve CO2 emission cargo weight by 22% compared to FY2006 levels
  • ·Achieved 21.1% improvement compared to FY2006. CO2 emissions decreased by 6.3% compared to the previous fiscal year from improved logistic efficiency but the basic unit of CO2 emissions increased by +4.6% compared to the previous fiscal year (cause of increase: increase in domestic long-distance transport requirements where the average transport distance per case increased +6.2% from 386km/case to 410km/case).
Improve the basic unit of CO2 emissions generated through shipping of products and components by 27% compared to FY2006 by FY2015 (Komatsu logistics facilities in Japan)
* From FY2013, the basic unit of CO2 emissions was globally unified and changed from per sales to per cargo weight.

·Shift to means of shipping with low environmental impact
Objectives for FY2013 Results for FY2013 Medium- and long-term objectives
Promote modal shifts in shipping from trucks to inland ferries or rail
  • ·The total modal shift rate in FY2013 was 28.7% (+12.4% compared to FY2006: +4.0% by railway, +8.4% by domestic vessels)
  • ·By proactively increasing the usage of domestic vessels in place of long-distance trucking to the north-east, which increased after the Great Eastern Japan Earthquake Disaster, the domestic vessel usage rate increased +5.3%
  • ·In the overall modal shift, the usage of railways has increased, increasing by +5.7% in total compared to the last fiscal year (modal shift ratio: 22.9% ⇒ 28.7%)
Continue to promote modal shift.
Curb the increase in CO2 emissions through the modal shift, switching long-distance trucking to domestic vessel shipment, in the transportation of products from the Awazu and Osaka to north-east Japan.Expand rail usage for engines, hydraulic equipment, transmission, etc.
Shift to battery powered forklifts Shift to hybrid and battery-powered forklifts that pose less strain on the environment for in-plant logistics. The ratio of hybrid and battery-powered forklifts has increased to 46.4%, +27.0% compared to FY2006 (+0.2% reduction compared to FY2012)
(Shift ratio to battery powered forklifts: FY2012 46.2% ⇒ FY2013 46.4%)
Promote reduction in environmental strain by increasing the ratio of battery powered and particularly hybrid forklifts.

·Strive to eliminate the procurement of new wrapping materials through promotion of returnable packaging containers.
Objectives for FY2013 Results for FY2013 Medium- and long-term objectives
Promote the returnability of packaging containers
  • ·In FY2013, general-purpose packing containers utilizing wood material continued to be improved from the point of supporting biodiversity.
    Returnable rate of general-purpose packing containers for CKD parts: 39.3% -> 49.0%(+9.6%)
    Returnable rate of general-purpose packing containers for replacement parts: 32.8% -> 53.7%(+20.9%)
    Reduced new purchases of packing material due to improved returnable rates.
Continue improvements in effort to acheive "zero" usage of new packaging material.
Continue improvement in the returnability ratio of containers designated for CKD parts.
Further improve the returnable rate of general-purpose containers for CKD/spare parts.

·Measures for protecting biodiversity and reduction in wood used in packaging containers
Objectives for FY2013 Results for FY2013 Medium- and long-term objectives
Reduction in the usage of wooden/cardboard packaging containers
Reduce the basic unit of usage per cargo weight by 6% compared to FY2010
Amount of wood/cardboard used in FY2013: 5,015 tons
Achieved an reduction by 37.7% compared to FY2010
27.8% reduction compared to the previous year (improvement of returnability and transition of materials for wooden containers)
10% improvement in ratio of wood and cardboard packaging material used per shipment weight by FY2015 compared to the FY2010 level.

·Promote reduction in shipping distances and improvements in shipping efficiency
Objectives for FY2013 Results for FY2013 Medium- and long-term objectives
Increase the size of shipped units to large lots
  • ·The continued improvement through the use of vans in CKD plants enhanced improvement from 96.9% to 98.4% (+1.5%). The enlargement of shipment units have reached the level of sustainability through increasing the use of containers in shipment.
  • ·The usage of vans at supply component plants, which we focused on improving in FY2012, increased from 56.3% to 99.1% (+42.8%). The transported amount of supply components increased from 7.8 tons per shipment to 8.3 tons per shipment (+6.6%), lowering CO2emissions by reducing vehicles used.
Improvement in the operation and management of CKD parts.
Increase the use of vans in plants for supply parts.
Continue improving to reduce the distance per shipment by utilizing nearby ports
  • ·In FY2007, Komatsu constructed harbor plants for assembling large-size shipping machinery in Kanazawa and Ibaraki; following this, the utilization rate of the Kanazawa and Hitachinaka Port were improved by the general consolidation of products from the Mooka and Komatsu Plants. As a result, the shipping distance was significantly reduced through the utilization of nearby ports. In FY2010, the average truck/trailer distance was shortened to 158km per shipment.
    The improvement increased by 27.7% (compared to 2007) and contributed directly to lowering CO2 emissions.
    < Suppression Measures for Increased Transport Distance and the Worsening CO2 Emission Basic Unit Due to Changes in Domestic Transport Configuration >
  • ·The configuration of domestic transport destinations greatly changed since the Great East Japan Earthquake in 2011 due to increased long-distance transport to the Tohoku region as well as export CKD with shorter transport distances and a sharp decline in export models (mining) produced at the port factories of Kanazawa and Ibaraki. As a result, the average transport distance of truck trailers increased to 204km/case in FY2013 and the rate of increase was +28.7% compared to FY2010. This increase in average distance directly translated to a worsening of the CO2 emissions basic unit. In order to improve the CO2 emissions basic unit, Komatsu sees the expansion of modal shift as a crucial measure and implemented actions to improve the modal shift rate.
    < Improvements in Transport Distance Reduction by Utilizing Nearby Ports >
  • ·Kanazawa Port utilization improved by +9% from 2012 to 45% against a mid-term target of 50%.
  • ·Hitachinaka Port utilization is 96% against the mid-term goal of 95%, thereby maintaining the achievement of the mid-term plan.
Continue reducing transportation distance by utilizing near-by ports.
Continue operation and management post achievement in the usage rate goal of the Hitachinaka Port.
Undertake improvement activities to improve the usage rate (main) of the Kanazawa Port from 40% to 50%.

From 2011
·Implement environmental conservation activities in global logistics (both national and international)
·Improve CO2 emission per cargo weight of shipping products and parts. (10 major overseas plants)
Objectives for FY2013 Results for FY2013 Medium- and long-term objectives
Per cargo weight
·CO2 emissions basic unit
·Improvement of 4% compared to FY2011
Implementation of monthly tracking of data for CO2 produced by shipment in 10 major plants in the Americas (2 in US, 1 in Brazil), EU (1 in UK, 1 in Germany) China (3), and Asia (1 in Indonesia, 1 in Thailand).
Set the FY2013 medium-term improvement goal as improvement by +0.8% in comparison to FY2011 levels.
CO2 was reduced by 1.8% compared to the previous year through improved logistical efficiency but the basic unit of CO2 emissions increased by +3.0%. (Main cause of increase: Loads destined for China, with long transport distances, increased by +38% compared to previous years and the average transport distance per truck trailer for factories abroad also increased compared to the previous year, leading to an increase in the basic unit (650 -> 669km/case, +2.9%)
8% improvement in the ratio of CO2 emission per shipment weight in the logistics of products and parts by FY2015 compared to FY2011 levels.
(10 major overseas Komatsu Group Plants)