Major achievements

Sustainability policy and KPIs of mid-term management plan

Based on its Sustainability Policy, Komatsu seeks to contribute to society through its business.
In the mid-term management plan, the company strives for sustainable growth by creating a positive cycle of resolving environmental, social, and governance (ESG) issues and improving earnings. This includes efforts to reduce environmental impacts in response to climate change, provide safe, high-quality, and efficient products, services, and solutions, and promote diversity and inclusion. To ensure the effective execution of these ESG initiatives, key performance indicators (KPIs) have been established, and progress towards achieving these KPIs is publicly disclosed. Additionally, the relationships between identified material issues, KPIs, and relevant SDGs have been organized.

Furthermore, the achievement of ESG-related KPIs is directly linked to the performance-based component of internal directors' remuneration under the mid-term management plan, specifically through Stock-Based Remuneration B.

	Sustainability Policy	Materiality		SDGs
With people	We provide an environment where diverse and global employees can work safely and healthily as one team, with respect for each individual, and with satisfaction and pride. We nurture employees who can take on challenges in various job sites and regions, create new value together with customers, and contribute to the realization of a sustainable society. As the Komatsu Group, we shall respect human rights related to all of our business activities.	Employees	Occupational safety and health and well-being
			Employee engagement and job satisfaction
			Diversity and Inclusion
			Skills development
		Human Rights	Respect for human rights

Materiality		Key activity themes	No.	KPI	FY2024 Targets	FY2022 KPI Performance	FY2023 KPI Performance
Employees
	Occupational safety and health and well-being
		Build workplaces that are safe and secure	1	Frequency rate of lost work time accidents（per 1 million hours）	Ongoing decrease from three-year average frequency rate of 0.65 from period of previous mid-term management plan (Performance disclosed)	0.80	0.62
	Employee engagement and job satisfaction
		Increase employee engagement	2	Engagement survey scores	1. Domestic score :75 or more (69 in FY2021) 2. Global score :85 or more (79 in FY2021) Notes: 1. Score represents rate of favorable responses.  2. Global engagement surveys are conducted once every two years (next survey to be conducted in FY2023).	Implementation of action plan based on FY2021 survey results	Second global engagement survey conducted 1. Domestic score: 69 2. Global score: 80
	Diversity and Inclusion
		Promote diversity and inclusion	3	Indicators related to female employees 1. Ratio of full-time female employees (consolidated) 2. Ratio of female managers (consolidated)	1. 17.0% or more (13.9% on March 31, 2022) 2. 13.0% or more (10.0% on March 31, 2022)	1. 14.1%(on March 31, 2023) 2. 10.3%(on March 31, 2023)	1. 14.5%(on March 31, 2024) 2. 11.1%(on March 31, 2024)
			4	Ratio of employees with disabilities (surpassing legally mandated rate)	2.5% or more (domestic, single fiscal year basis, legally mandated level of 2.3%)	2.42%	2.48%
	Skills development
		Develop individuals' skills and achieve business growth	5	Succession plans	Increased succession planning for senior management positions at overseas Group companies	Definition of global key positions and formulation of succession plans	Support and opportunities for development into global key positions
			6	Development of human resources with digital transformation and Al skills	Three-year aggregate numbers of training recipients 1. Digital transformation :900 for entry level, 180 for practical 2. AI :90 for entry level, 30 for practical	1. Digital transformation:5,341 for entry level* , 44 for practical 2. AI: 30 for entry level, 10 for practical Notes: * Entry level digital transformation course administered to wider range of employees via video lectures	Two-year aggregate numbers of training recipients 1. Digital transformation: 5,643 for entry level* , 84 for practical 2. AI: 60 for entry level, 20 for practical Notes: * Entry level digital transformation course administered to wider range of employees via video lectures
			7	Cultivation of Smart Construction consultants	1,000 (aggregate)	867	953
Human Rights
	Respect for human rights
		Promote human rights due diligence	8	Human rights due diligence activities	1. Internal 2. Procurement supply chain 3. Sales	1. Internal:survey targeting all Group companies 2. Procurement supply chain:Online survey targeting major suppliers 3. Sales:On-site impact assessment in South Africa	Revised human rights policy 1. Internal: Implemented "Business and human rights basic education" 2. Procurement supply chain: (I) Conducted "Training for procurement officers" (II) Conducted on-site interviews with major suppliers 3. Sales: Held discussions with the Marketing Department

	Sustainability Policy	Materiality		SDGs
With business	We contribute to society through our business activities by providing our customers with safe and highly productive products, services, and solutions that realize sustainable infrastructure development, resource development, and a recycling-oriented society. We build relationships with our business partners and local communities that enable mutual trust, fairness, co-existence, and co-prosperity. We comply with the rules of society, including laws and regulations, and strive to respond sincerely to the requests and expectations of all stakeholders, including society.	Customers	Product safety and quality Provision of solutions
		Ethics / Governance	Governance / Compliance
		Communities	Contributions to local communities

Materiality		Key activity themes	No.	KPI	FY2024 Targets	FY2022 KPI Performance	FY2023 KPI Performance
Customers
	Product safety and quality Provision of solutions
		Enhancement of product safety	9	Development of safety devices and expansion of range of marketed models equipped with safety devices (KomVision, etc.)	Expansion of range of marketed models equipped with safety devices	Completion of introduction in three small sized wheel loader models	Drowsiness detection systems have been retrofitted onto HD785-7s in Europe and Southeast Asia (the Philippines). With the exception of certain models, it has been implemented in the current rigid dump trucks.
		Improve productivity of construction workplaces by promoting Smart Construction	10	Overseas sales of ICT-intensive models	2,700 units (single year)	2,448	2,038
			11	Number of workplaces using Smart Construction (global total)	13,000 workplaces (single year)	8,955	11,740
			12	Enhancement and optimization of processes	Ratio of workplaces using Smart Construction that employ Solution Level 3 or higher: 15%(single year)	20%	22%
		Provision of products and solutions that enable sustainable resource development (mining equipment)	13	Aggregate number of AHS units deployed	790 units (aggregate, upward revision from prior target of 740 units)	643	727
			14	Optimization of mining operations	Introduction and promotion of open technology platforms	Completion of phase 1 development and commencement of trials at customer workplaces	Currently conducting trials at multiple customer sites
			15	Augmentation of hard rock mining product lineup	Expansion of product lineup and execution of trials including those for new methods (mechanical cutting)	Load haul dump machines: Completion of development of one model Mechanical cutters: Advancement of trials at customer workplaces and launch targeting specific customers Mining Tunnel Boring Machine: Production of trial units underway	Hydraulic excavators: Testing conducted on joint research vehicles with specific automatic excavation functions Mining bulldozers: Ongoing preliminary research on collaboration between remote-controlled bulldozers and AHS dump trucks
			16	Expansion of hard rock mining business	Net sales: US$ 300 million (threefold increase)	Net sales: US$100 million	Net sales: approximately US$80 million
		Solutions for improving safety and productivity at customer workplaces (automation, autonomous operation, remote operation)	17	Development of automated construction and mining equipment	Expansion of number of marketed models (including new developments)	Hydraulic excavators: Tests conducted on equipment jointly developed with customers Mining bulldozers: Remote controls trials at customer workplaces completed, automated operation trials underway	Hydraulic excavators: Testing commenced on joint research vehicles with customers Mining bulldozers: Completion of remote-control trials at customer sites, automated operation trials underway, and expansion of models introduced to the market (including new developments)
		Building of value chain adaptable to environmental and demand changes	18	Expansion of aftermarket business (pursuit of business growth and response to volatility)	Sales growth rate: 15% (compared with FY2021, foreign exchange rates fixed)	Sales growth rate: 13.5%(compared with FY2021, foreign exchange rates fixed)	Sales growth rate: +20% (compared with FY2021, foreign exchange rates fixed)
			19	Multi-sourcing ratio (Implementation of business continuity measures across supply chain)	92% (82% in FY2021)	85%	91％
Ethics / Governance
	Governance / Compliance
		Strengthen governance and ensure thorough compliance	20	Enhancement of governance and entrenchment of compliance	Disclosure of initiative results	Enhancement of disclosure based on Japan's Corporate Governance Code (business portfolio, skill matrix) Global e-learning program on Komatsu’s Worldwide Code of Business Conduct (conducted in 12 languages)	Incorporation of third-party analysis in the evaluation process of the Board of Directors' effectiveness Global e-learning program on Komatsu’s Worldwide Code of Business Conduct (conducted in 12 languages)
Communities
	Contributions to local communities
		Contributions to communities through business and disaster relief support	21	Ongoing social contribution activities	Disclosure of activity results	Continuation of demining project Provision of ￥30million in relief support following earthquake in Turkey and Syria Continuation of forest restoration projects at former mine sites in North America Ongoing provision of support for regional human resource development programs with Cummins Inc. (Chile, Peru, South Africa, and Australia)	Continuation of the demining project Support for earthquake-affected areas in the Noto Peninsula (I) Donation of 600 million yen in relief funds (II) Free lending of heavy machinery to affected municipalities and support organizations (III) Provision of disaster relief supplies (e.g., emergency food) Continuation of the forest restoration project at former mine sites in North America Ongoing support for regional human resource development programs with Cummins Inc. (Chile, Peru, South Africa, and Australia)

	Sustainability Policy	Materiality		SDGs
With the planet	Through all of our business activities, we strive to reduce our environmental impact and preserve the global environment through the use of advanced technologies. We strive to increase both global environmental conservation and business growth through manufacturing and technological innovation. We pursue collaboration and value creation with our stakeholders toward a sustainable planet and future.	Environment	Reduction of energy usage and GHG emissions
			Development of low-carbon / low-emissions products, solutions, and business models
			Forest conservation through business activities
			Resource recycling and remanufacturing

Materiality		Key activity themes	No.	KPI	FY2024 Targets	FY2022 KPI Performance	FY2023 KPI Performance
Environment
	Development of low-carbon/low-emissions products, solutions, and business models
		Plants with zero environmental impacts	22	CO2 emissions from production	45% reduction (compared with FY2010)	43％ reduction	51％ reduction
			23	Water consumption	70% reduction (compared with FY2010)	69％ reduction	67％ reduction
			24	Rate of renewable energy use	20%	17％	25％
	Reduction of energy usage and GHG emissions
		Reduction of CO2 emissions at customer workplaces	25	CO2 emissions from product use	24% reduction (compared with FY2010)	21％ reduction	22％ reduction
			26	Electrification of construction and mining equipment	Expansion of models in development phase and on market	Launch of one model Completion of development of two models	Launch of three models
	Forest conservation through business activities
		Provision of solutions that support sustainable, cyclic forestry businesses	27	Growth of forestry machine business (process mechanization)	1. Sales growth rate : 50% (compared with FY2021, foreign exchange rates fixed) 2. Number of tree planting machines introduced : 30 (single year)	1. Sales growth rate: 22.1％ （compared with FY2021, foreign exchange rates fixed) 2. Number of tree planting machines introduced : 5	1. Sales growth rate : 28% (compared with FY2021, foreign exchange rates fixed) 2. Number of tree planting machines introduced : 9
			28	Promotion of forest management solutions (Development of business model combining forestry and decarbonization)	Forest area : 60,000ha	Completion of remote control sensing solution proof of concept test and selection of partners	Forest area : 23,705ha
	Resource recycling and remanufacturing
		Promotion of recycling-oriented business	29	Expansion of Reman business	Sales growth rate: 25% (compared with FY2021, foreign exchange rates fixed)	Sales growth rate: 16.5%(compared with FY2021, foreign exchange rates fixed)	Sales growth rate: 35% (compared with FY2021, foreign exchange rates fixed)