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CSR

Growing with Society

Frameworks for Promoting Compliance

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

Strengthening Compliance

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

Komatsu's Code of Worldwide Business Conduct

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

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

Process for Compliance Activities
  • (1) Establish the Code of Business Conduct
    Formulate Komatsu's Worldwide Code of Business Conduct as a foundation for compliance activities and revise this code (currently in its 8th edition) as required to reflect social change.
  • (2) Implement the Code of Business Conduct
    Implement the Code of Conduct through education that corresponds to employee rank and the types of operations in which they are involved, and by communicating information in accordance with Komatsu's Worldwide Code of Business Conduct.
  • (3) Determine the Code's current status
    Determine the level at which Komatsu's Worldwide Code of Business Conduct is being applied by having all business units regularly report on their use of the code and by conducting audits and enhancing the Internal Reporting System.
  • (4) Address inadequacies
    Any issues identified during the above activities will be addressed in accordance with Komatsu's Worldwide Code of Business Conduct and preventive measures will be implemented.

Toward Thorough Compliance

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

Internal Reporting System

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

State of Compliance in FY2012

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

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