Tokyo - Kawasaki Heavy Industries, Ltd. announced today that it has concluded a loan agreement with Development Bank of Japan Inc. (hereinafter, DBJ) through DBJ Sustainability Linked Loan with Engagement Dialogue (hereinafter, DBJ-SLL with Engagement Dialogue) as a sustainable finance initiative, following the issuance of its sustainability bonds in July 2021 and the introduction of Positive Impact Finance in August 2021.

DBJ-SLL with Engagement Dialogue provides support through dialogue with DBJ as the lender to set appropriate KPI (key performance indicator) that contributes to the advancement of the sustainability management and also 'Sustainability Performance Targets' (hereinafter, SPTs) that are consistent with sustainability strategies, based on the 'Sustainability Linked Loan Principles' (hereinafter, SLLP) drawn up by the Loan Market Association and the Green Loan and 'Sustainability Linked Loan Guidelines' issued by the Ministry of the Environment. DBJ will also conduct continuous dialogue during the loan period to encourage and motivate Kawasaki to achieve the SPTs.

DBJ-SLL with Engagement Dialogue has set the following KPI and SPTs regarding the establishment of a hydrogen supply chain which is an important component of 'Energy and Environmental Solutions,' one of the priority fields in our 'Group Vision 2030' , and also essential for the sustainable growth of Kawasaki and the achievement of carbon neutrality in Japan.

KPI 	Establishment of Hydrogen Supply Chain
SPTs I 	Construction of 1 large liquefied hydrogen carrier to be commercialized by FY 2026
SPTs II 	Transporting capability of 225,000 tons/year or more of liquefied hydrogen to Japan by FY 2031

The company has set a sustainable finance target for 50% of its long-term debt in FY2030 and 100% in FY2050. By making active use of sustainable finance, they will accelerate their sustainability management initiatives to realize the Group Vision 2030 and strengthen their engagement with stakeholders to contribute to the achievement of the SDGs and a sustainable society.

Qualification for SLLP and Sustainability Linked Loan Guidelines

1. Selecting Internal Review

Upon execution of the Loan, Kawasaki and DBJ discussed compliance with the SLLP and the Sustainability Linked Loan Guidelines, leading to the selection of an internal review.

2. SPTs Overview

SPTs I

Construction of 1 large liquefied hydrogen carrier to be commercialized by FY 2026

SPTs II

Transporting capability of 225,000 tons/year or more of liquefied hydrogen to Japan by FY 2031

3. Internal Expertise for SPTs

Under the Kawasaki Group Mission Statement and the Group Vision 2030, Kawasaki is implementing an advanced sustainability management approach that aims to contribute to solving social and environmental issues and pursue sustainable growth, making full use of the diverse and advanced technological capabilities of its core businesses, focusing on its 3 fields ('A Safe and Secure Remotely-Connected Society', 'Near-Future Mobility' and 'Energy and Environmental Solutions'). The organization to promote sustainability management is a company-wide system involving top management.

Related Links

About DBJ Sustainability Linked Loans with Engagement Dialogue

URL: https://www.dbj.jp/en/service/program/interactive/?sc=1

About Kawasaki's Sustainable Finance

URL: http://global.kawasaki.com/en/corp/sustainability/finance/index.html

About Sustainability Linked Loan

URL: http://global.kawasaki.com/en/corp/sustainability/finance/sll.html

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