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Message from the President

The Kobe Steel Group is ushering in a new stage in environmental and social contributions through monozukuri.

Innovative Kobe Steel Group products and technologies can be found in every corner of life and society. The Group conducts CSR activities that contribute to the environment and society through monozukuri (or manufacturing). The following message from Kobe Steel President, CEO and Representative Director Hiroya Kawasaki focuses on the Group's medium- to long-term business vision and the new stage in environmental and social contributions that this vision brings.

The Kobe Steel Group's mission is to support modern lifestyles and society through monozukuri.

Since its establishment over a century ago in 1905, the Kobe Steel Group has supported industry and society through monozukuri.

The Kobe Steel Group focuses on material businesses - such as steel, welding, aluminum and copper - as well as machinery businesses such as industrial machinery, construction machinery and engineering. The Group is also active in a wide variety of other important fields, including the generation and wholesale supply of electricity, real estate, and electronic materials. Our mission is to use products and technologies in these business areas to create a better foundation for industry and daily life.

Under our medium- to long-term business vision, KOBELCO VISION “G,” we pursue environmental and social contributions through our businesses.

Under our medium- to long-term business vision, KOBELCO VISION “G,” the Kobe Steel Group is pursuing a variety of business improvements. One of the key points among these improvements is the strengthening of monozukuri that contributes to the environment and society.

The Group currently boasts a wide array of products and technologies that help to reduce environmental impact, capitalize on unutilized resources, and otherwise contribute to solving the issues that directly face society. Our aim as a corporation is to strengthen manufacturing in these fields and thereby contribute further to the environment and society.

KOBELCO VISION “G” is currently in its second stage (fiscal 2013-2015). Using the foundation built in stage one (fiscal 2010-2012), we will pursue the development of new value-added products and technologies that contribute to society and the environment.

We are accelerating the development of automotive lightweighting, hydrogen fueling stations and other new technologies linked to environmental conservation.

Parallel with stage two of KOBELCO VISION “G,” the Group is focusing on business areas related to environmental conservation. For instance, we are moving forward with a joint venture in China to produce high-strength steel used to create lighter weight automobiles. This will help automobiles meet stricter fuel regulations and reduce CO2 emissions. We are also in the process of building a plant in China to make aluminum sheet for automotive body panels.

The shale gas revolution occurring in North America is also a major part of our agenda. A wide range of technologies is necessary to utilize shale gas, including steel, welding, industrial machinery, excavators and cranes, and environmental mitigation technologies. We will help support this revolution by strengthening cooperation throughout the Group.

We also plan to utilize original KOBELCO technologies in hydrogen fueling stations. These stations are necessary to popularize fuel cell vehicles. We now stand at the dawn of fuel cell vehicle technologies. By maximizing the Group's combined strengths, we will help to support a hydrogen-based society for future generations.

We will earn the support of local communities by engaging in a wide variety of social contributions.

The Kobe Steel Group has plants and offices located throughout Japan and the world. As a good corporate citizen operating in harmony with communities, we strive to carry out a variety of activities that contribute to the society around us.

Activities such as cleanup drives near our facilities and the holding of events in cooperation with the public are fundamental in earning the support of local communities. Through the KOBELCO GREEN PROJECT, employees carry out forest maintenance activities at two locations in Hyogo Prefecture. We have also introduced the KOBELCO Forest Fairy Tale Prize, which solicits stories related to nature and forests from elementary, middle and high school students. Winning stories are then turned into picture books. In addition, We continue to contribute to society through promotion of local sports, particularly rugby.

We are dedicated to thorough compliance, with each and every employee taking personal responsibility.

Safety and compliance are at the root of all our activities. Although we strive to contribute to customers and society in our daily work, one mistake can still lead to a profound loss of trust. As a result, we aim to enforce the strictest compliance in our work and throughout the organization, and we believe that each and every employee should think of compliance as their own issue.

We are very proud of the environmental and social contributions made by the Kobe Steel Group. My sincerest hope is that those reading this report will gain some insight into our CSR activities.

Hiroya KawasakiHiroya Kawasaki

President , CEO and Representative Director

Kobe Steel, Ltd.

Kobe Steel Group Corporate Philosophy

1.

We provide reliable and advanced technologies, products and services that satisfy customers.

2.

We support each employee in developing his or her abilities, while respecting mutual cooperation within the Kobe Steel Group.

3.

Through continuous efforts for innovative change, we aim to enhance our corporate values.

The Kobe Steel Group is dedicated to meeting society’s needs by sharpening its technical capabilities and skills while offering superior products and services. We also believe in working toward a common goal while remaining mindful of personal respect and Group harmony. Through the support of all those involved, we have strived to develop society and achieve happiness for workers. In light of the turbulent business environment faced by companies in this day and age, we believe that a swift and appropriate response to change made with a challenging spirit is more important than ever.

These beliefs are reflected in the corporate philosophy above. As always, we will strive to develop hand-in-hand with society, through employees who share in our corporate values.