YKK Group Social & Environmental Report 2014

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Environmental management

YKK Group Fourth Mid-term Environmental Management Principles (fiscal 2013–2016)

Themes Items Action plans

Corporate GovernanceStrengthen global environmental management system

•Continue and further develop group environmental management audit (enhance environmental management)•Continuestandaloneenvironmentalcrossauditswithineachregion(maintainenvironmental

compliance)

Green InnovationMonozukuri* for the next- generation (technological innovation)

•Constantlydevelopproductlinesthatcontributetoareducedcarbonfootprint,resourcerecyclingandasociety in harmony with nature•Developnewproductsthatwillhelpsolvesocialissues

CSv: Creating Shared valueSocial contribution through primary business (value of corporate presence)

•Promoteandfurtherdevelopcooperationwithsociety(customers,NPOs,communities,etc.)•Promoteandexpandthescopeofmutualdisclosureofenvironmentalinformation

(share approach to social issues)

Sustainability: low-carbon initiatives, resource recycling and harmonious coexistence with nature

CO2 reduction (low energy, energy saving)

•Keepworkingtoreduceelectricalusage(higherefficiency,stabilization,invention)•GraduallyreduceCO2 emissions including supply chain (introduction and expansion of Scope 3**)

Biodiversity•Introduceandexpandeffortsrelatedtotheconservationofnature,particularlywater(WET***)

•Cooperate with supply chain partners in consideration of biodiversity

Chemical substance risks•Clarifyenvironmentalobligationsineachcountryandreducerisksofmeetingthoseobligations

•Secure, maintain and improve the safety of manufacturing and products

Resource recycling•Reducewastevolumeandincreaserecyclingrate

•IntroduceMFCA****tofurtherincreaseuseofresourcerecyclingandimproveusageefficiency

* Monozukuri: Japanese term that has multiple meanings centering on manufacturing, such as “design” and “craftsmanship”

** Scope 3: GHG emissions from supply chain (at stages of manufacture, transportation, business trip, product use, etc.)

*** WET (Whole Effluent Toxicity): A method of wastewater management that uses biological impact as an indicator. It assesses groups of species—crustaceans, algae, and fish.

**** MFCA (Material Flow Cost Accounting): An environmental management accounting system designed to maintain a balance between resource efficiency and economic efficiency

Our approach to environmental activities

YKK Group Fourth Mid-term Environmental Management Principles(Fiscal 2013-2016)

—Contribution to the creation of a sustainable society—

Monozukuri (manufacturing operations) in quest for “low energy/energy saving”

The YKK Group contributes to the creation of a sustainable society in

conformity with its environmental pledge, by caring for the environment

and by creating new values using its technological capabilities.

YKK Group Environmental Pledge

It is recognized today as being a most important duty for all

humankind that we preserve the abundantly endowed global envi-

ronment and that we transfer it to the next generation in a sound

condition. Striving to be an earth-friendly company, the YKK Group

proclaims that it will address and promote “harmony with the

environment” as the highest priority of its business activities.

September 20, 1994Tadahiro Yoshida, YKK Group

YKK Group Social & Environmental Report 2014

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Environmental management

INPUT OUTPUTYKK Group

Environmental impact mass-balance of YKK Group domestic plants/offices (fiscal 2013)

Electric power (power purchased from power companies)

544.56 million kWh

CO2 454,000 t

NOx 63.3 t

SOx 28.7 t

Wastewater 17.68 million m3

BOD 48.8 t

Amount of waste disposed 97,674 t

Amount of waste recycled 96,623 t (recycling rate) 98.9%

Fuel (heavy oil, kerosene, gas, light oil, gasoline)

Energy equivalent 1,609 TJ

Water (not including reused water) 18.65 million m3

Chemical substances (PRTR substances ) 2,103 t

Aluminum 125,704 t Copper 13,121 t Recycled copper 1,007 t

Copy paper 344 t

The YKK Group’s fiscal 2013 environmental targets and performanceThemes Items Fiscal 2013 results Rating

Corporate Governance

Strengthen global environ-mental management sys-tem

•Established platforms for each region to conduct environmental cross audits and conducted YKK Group environmen-tal management audits (three domestic bases and three overseas subsidiaries) •Conducted environmental cross audits within each region under the leadership of headquarters companies and identi-fied the need for ongoing assistance to enhance audit accuracy and to ensure constant implementation

Green InnovationMonozukuri* for the next generation (technological innovation)

•AP eco product ratio reached 97% (within product lines developed for fiscal 2013 release) and the Company won external recognition for its eco-friendly products (e.g., APW 330 won a prize under the Eco-Products Awards program)•The Fastening Products Group completed R&D projects under its key environmental themes ahead of schedule •The Machinery and Engineering Group succeeded in reducing electricity use at the following facilities: two-core fas-tener production units: an average of 40%; AP finishing units on three lines: an average of 58%; and AP material pro-duction units on the Shikoku Plant’s extrusion molding line: an average of 16%

CSv: Creating Shared value

Social contribution through primary business (value of corporate presence)

•Held YKK Group Tree Planting Day at 43 bases of operations •Provided local elementary school students with environmental education programs during their summer vacation sea-son in tandem with NPOs operating in the Kurobe area

Sustainability: low-carbon initiatives, resource recycling and harmonious coexistence with nature

CO2 reduction (low energy, energy saving)

•Calculated the volume of GHGs emitted from all plants overseas, assessed Scope 3 CO2 emissions from domestic operations and expanded the use of an air-conditioning system that utilizes groundwater heat

•The AP business decreased its unit energy consumption 10.5% compared with the fiscal 2010 level while investing in energy-saving technologies such as efficient lighting and visualizing the status of energy use•The Fastening Products Group reduced CO2 emissions per unit of net sales 22.9% compared with the fiscal 1998 level and 4.1% compared with the fiscal 2012 level (surpassing the target of a 19.7% reduction from the fiscal 1998 level) •The Machinery and Engineering Group reduced CO2 emissions per unit of production 1.7% year on year (sur-passing the target of a year-on-year 1% reduction)

Biodiversity •Drew up five-year development plans for the Furusato-no-Mori forest and biotopes in line with the formulation of the future vision for these sites

Chemical substance risks

•Assessed environmental obligations held by overseas Group members with regard to such items as PCBs and chloro-fluorocarbons, secured responsiveness to such international treaties as the Minamata Convention on Mercury and decided on voluntary actions to be taken by the YKK Group •The Machinery and Engineering Group switched to detergents without PRTR Class I Designated Chemical Substance content for use in parts production processes

Resource recycling •Completed the introduction of Web manifests for all sites in Japan, began using Waste Data Sheets (WDSs) and revised in-house guidelines for the evaluation of waste disposal contractors

* Monozukuri: Japanese term that has multiple meanings centering on manufacturing, such as “design” and “craftsmanship”

YKK Group Social & Environmental Report 2014

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Environmental accountingFiscal 2013 environmental conservation costs (total for YKK Group companies in Japan) (Unit: ¥1 million/year)

Item Description of main initiatives Equipment investment Cost

Costs withinbusiness area

Prevention of pollution

Operation, upgrading and maintenance of wastewater treatment facilities 155 732

Conservation of the global environment

The improvement of energy-saving efficiency, replacement of fluorescent lighting equip-ment and renewal of compressors and high efficiency boilers

649 215

Recycling of resources

Promotion of resource recycling and management of industrial waste 2 435

Business area internal cost total 806 1,382

Upstream/downstream costsCost for processing debris and cost of equipment that helps operators load and unload cardboard boxes

0 752

Management activities costsThe maintenance of ISO certifications, participation in environmental exhibits, environ-mental reports, environmental analyses, tree planting and biodiversity protection

2 389

R&D costs Development of eco products 0 2,374

Social activities costs Collaborative volunteer activities with local community 0 42

Environmental damage repair costs —— 0 0

Other costs Inspection/management of fire extinguishing equipment 1 36

Total 809 4,975

Fiscal 2012 650 5,191

Fiscal 2011 697 4,694

Fiscal 2010 291 4,457

Fiscal 2009 381 4,310

Environmental equipment investment Environmental costsSales

(Unit: ¥100 million)

Total equipment investment(Unit: ¥100

million)(Unit: ¥100

million)Ratio to sales

(%)

Equipmentinvestment ratio

(%)

(Unit: ¥100 million)

Ratio to sales(%)

Fiscal 2013 8.1 0.2 3.3 49.6 1.3 3,904 245

Fiscal 2012 6.5 0.2 3.0 51.9 1.5 3,465 220

Fiscal 2011 7.0 0.2 3.5 46.9 1.4 3,284 202

Fiscal 2010 2.9 0.1 1.9 44.6 1.4 3,116 150

Fiscal 2009 3.8 0.1 2.2 43.1 1.4 3,012 171

Environmental management

Record of ISO 14001 and other environmental management system certifications(total sites certified)

(Number of sites)

(FY)

Japan (ISO 14001) Japan (Eco Action 21) Overseas (ISO 14001)

25

10

21

36

50

61 60

71 717171

200920082007200620052004200320022001200019991998 2010 2013201220110

20

40

60

80

57

666967

In February 2005, YKK AP Inc. unified 10 sites that had been independently certified into one organization, resulting in a reduction in the total site count.In May 2010, YKK Rokko Corporation acquired the Eco Action 21 certification. This completed the implemen-tation of an environmental management system at all domestic Group companies.Third-party ISO 14001 verification and an internal audit confirmed that there was no material violation of environment-related laws and regulations.