Komatsu issues first “green bond” to drive development of environmental solutions

As an indication of Komatsu’s global commitment to sustainable business operations, the company has announced it will be issuing its first “green bond” through a public offering on the Japanese bond market.

Green bonds are designed to raise funds for exclusive use in business initiatives which work to help solve environmental problems.

To be issued by Komatsu Ltd, the company plans to use the proceeds from this green bond to research and develop, manufacture and distribute products such as hybrid hydraulic excavators and electric construction equipment – which allow for significant reductions in CO2 emissions during their lifetimes.

In addition, proceeds from the bond will be used to further develop services which support fuel-efficient machine operations, such as KOMTRAX and SMARTCONSTRUCTION, with their focus on ICT (Information Communications Technology) to improve fleet, machine and project efficiency.

Komatsu also plans to apply the funds towards developing facilities and equipment to help reduce CO2 emissions in manufacturing, and increase the ratio of renewable energy use.

Komatsu’s announcement of its green bonds issue is part of its three-year mid-term management plan: DANTOTSU Value - FORWARD Together for Sustainable Growth, to be completed by March 31, 2022, said Colin Shaw, Komatsu’s Executive General Manager, People and Strategy.

“Komatsu is committed to making efforts for sustainable growth through a positive cycle of improving earnings and solving ESG (environmental, social and governance} issues,” he said.

“Under this management plan, we have developed 20-year targets for the period between 2010 and 2030, which include reducing our CO2 emissions by 50% and increasing our ratio of using renewable energy to 50% of total energy use.

“That is an important driver of our program to provide high-quality, high-performance products, services, and solutions – all designed to reduce environmental impacts, particularly in relation to climate change – as well as enhance safety.

“With the proceeds from this green bond, Komatsu will further accelerate our efforts to help achieve zero net carbon emissions across the global economy,” said Colin.

“Komatsu has been proactive in researching and developing products and services that contribute to fuel efficiency – which in turn reduce CO2 emissions – for many years.

“Our issuing of this green bond is a significant part of our global Komatsu sustainable strategy,” he said.

“Here in Australia, we are also committed to reducing our carbon emissions, through the use of solar power generation and low-energy products at our facilities throughout the country.

“And as our customers become more aware of environmental issues, and the business and environmental benefits of more fuel-efficient products and services, they’ll be looking to suppliers such as ourselves to be taking the lead,” Colin said.

As part of our ‘Dantotsu Value’, Komatsu has also recently launched the One World One Komatsu program. This is a Komatsu global employee initiative that encourages all our employees to participate in sustainable actions at work or home and collectively make a difference to our quality of life.

“The One World program is a fantastic opportunity for our people to build on Komatsu’s sustainability commitment and continue to develop a culture that prioritises the environment, sustainability for future generations and individual well-being. Employee engagement and community connection is a primary driver to the program’s success.  For those who sign up to be part of the program, their actions are tracked and through an environmental calculation these actions are turned into real life measures of success, like the amount of reduced CO2 emissions released, number of trees saved or planted, waste not sent to landfill and much, much more!” Colin said.

“This is an exciting era and we’re looking forward to a brighter and more sustainable world.” he said.