2011 Sustainability Report Editorial Policy

The report aims to inform all stakeholders, including all customers, stockholders, employees, etc, that how Fuji Xerox high- technology (Shenzhen) Ltd (Fuji Xerox Shenzhen for short) looks at CSR (corporation social responsibility), and activities for the realization of sustainability in 2010. We also hope to seek more suggestions and advices from all circles through this report.

Time period covered: Sustainability Report 2011 covers Fuji Xerox's activities during the fiscal year 2010 (April 1, 2010 to March 1, 2011); however, some contents are beyond the above period.

Organization Covered: Full Fuji Xerox high-technology (Shenzhen) Ltd

Guidelines Applied: Sustainability Reporting Guidelines (3.0), GRI * GRI stands for: Global Reporting Initiative

Next Release of Sustainability Report: August, 2012

If you want to read Fuji Xerox (Shenzhen) “Sustainability Report 2011”online, please visit the website: http://www.fxsz.com.cn

If you have any question on the report, Please consult: CSR department Fuji Xerox (Shenzhen) Add: Changqing Industry Park, Dahe country, Guanlan town, Baoan district, Shenzhen city, province Code: 518110 Tel: +86 0755 27981111 Fax: +86 0755 27981535.

This report is printed with recycled paper and green printing ink.

FuJi Xerox 1 Sustainability Report 2011 Table of Contents

CSR Philosophy of Focus Report Fuji Xerox Build Harmonious Labour Relations Conceiving on Excellent The Promotion of Environmental Corporation Management Safety Management Message from the President Co-operational Promotion with Suppliers

3-7 8-23

Legal Compliance, Working on Improvement Sincerity and Reliability Green Production of Staff Caring

Continuous Advance to Internal Control of Hazardous Chemicals Strengthening EAP Control System (Employee Assistance Program) Certificate of resource conservation products Training of Talented People Logistic Service for Employees

24-25 26-27 28-32

Grow Up With the Local Region Dedicating Charity, Servicing Social Awards and Community and Promulgating Contribution Civilization

33-34 35-36

FuJi Xerox Sustainability Report 2011 2 CSR Mission of Fuji Xerox

For a Sustainable Society and Future

Mission Statement

Building an environment Promoting global mutual Encouraging self- of creating and utilizing trust and enriching cultural development, experiencing of knowledge development growth joy

Innovation

Corporate Quality

Business Stockhold Partner

Economic Value

Employee Corporate Personal Descendant Value

Social Value

Local Customer Community

Corporate Quality

Corporate quality refers to the innovative integration and harmonization of three components: economic value, social value, and thus create values for the stakeholders.

For Fuji Xerox, CSR is to seek for corporate quality.

In seeking for the corporate quality, Fuji Xerox endeavors itself to the realization of the value target defined in its mission declaration.

We believe these activities will create a society of sustainable development.

FuJi Xerox 3 Sustainability Report 2011 Conceiving on Excellent Corporation

Corporate Vision

Fuji Xerox (Shenzhen) put up with the concept of “Outstanding Company” in 1992 and based on this, it set its target of “being friendly, joyful and powerful”.

Powerful: be able to create value for customers and investors Friendly: to the society and environment Joyful: to work and life

● Contribution to customers and ● Posts for creativity shareholders ● Concern at environment Powerful ● Contribution to local community and ● Personal accomplishments international society Friendly Joyful

An outstanding Company

Corporate philosophy

Provide excellent quality and value and meet customers' needs. Provide the investors with attractive value through high-quality and sustainable development. Respect the social environment and natural environment. Create a company that employees are proud of.

Shared Value

Customers' satisfaction Environment Adventure concept

Enjoyment/ Advanced achievement ethics Shared values Trust/ Scientific understanding reflection

Diversified Professioni- culture zation Team work

FuJi Xerox Sustainability Report 2011 4 President and General Manager: Okaji Toshihiko

Message from the President

It is time to release an annual sustainability report again.

China is changing quickly; however, our attitude and way to employees of Fuji Xerox (Shenzhen) does not change. For all employees, we have been persisted in educating them not only from the social aspect but also from the occupational aspect.

Differently with before, employment, income and economic development in China inland has improved a lot. Based on this, I think migrant workers in Shenzhen will be more instability, since the difference between Shenzhen and China inland is becoming smaller and smaller although Shenzhen is still the best city in employment compensation.

Shenzhen itself is also transferring to a high-technology, service industry city, it will not welcome simple, no added value manufacture industry in the future, however, we all know that most revenue of Shenzhen just come from the manufacture industry right now.

As a company in Shenzhen, we are trying to expand more middle-class by manufacturing HR rather than manufacturing goods. A manufacturer could not be a great manufacturer unless he realized to apply his knowledge and try his best to produce good things. I think the process is important for us and for our HR.

We gained a lot from China's development; we also contributed to Chinese economic development. As well as enhancing the improvement on production, we hope to be a stage for every one and continuously provide development chance for everyone.

FuJi Xerox 5 Sustainability Report 2011 Fuji Xerox Corporate Profile

Overview

Name: Fuji Xerox Co., Ltd Headquarters: Tokyo, Japan Date of Establishment: 20th February, 1962 (Established as a joint venture between Rank Xerox Limited, whose name was changed to Xerox Limited on October 31, 1977, and Fuji Photo Film Co., Ltd.) Capital: 20 billion JP Yen Shareholders: FUJIFILM Holdings Corporation (75%) Xerox Limited (25%)

Overseas Business Site

Fuji Xerox takes on the core task in R & D, Marketing and Service etc. Simultaneously, facing of the rapid growth of Asia and South Pacific regions, Fuji Xerox dedicates to continuously expand its international business as a result of promoting strong partnerships with respect for differences, equality, mutual benefit, voluntarism and consensus.

Fuji Xerox Overseas Affiliates Companies Fuji Xerox's Main Offices

Xerox Xerox Limite Corporation Fuji Xerox (Korea) Co., Ltd. Fuji Xerox (China) Ltd. Fuji Xerox Co., Ltd. FX Global Inc Fuji Xerox (Far East) Ltd. Fuji Xerox of Shanghai Ltd. Fuji Xerox (Taiwan) Co., Ltd. Xerox International Partners Fuji Xerox (Thailand) Co., Ltd. Fuji Xerox (Philippines) Inc. Fuji Xerox of Shenzhen Ltd. FX Palo Alto Laboratory Fuji Xerox Asia Pacific Fuji Xerox Procurement and Manufacturing Companies Indo-China Operation Fuji Xerox () Co., Ltd. P.T. Astra Graphia Fuji Xerox Asia Pacific Malaysia Operation Fuji Xerox (New Zealand) Ltd. Fuji Xerox (Malaysia) Co., Ltd.

Fuji Xerox (Australia) Pty Ltd. Fuji Xerox (Singapore) Pte Ltd.

FuJi Xerox Sustainability Report 2011 6 Fuji Xerox of Shenzhen Profile

Overview

Name: Fuji Xerox of Shenzhen Ltd. Date of Establishment: 2nd June, 1995 Ownership: Sole Foreign-Owned Enterprise Capital: 38 Million US Dollar Gross Assets: 59 Million US Dollar Number of workers at posts: 8111(As of March 2011)

Business Scope: The company develops, designs and manufactures laser printers, ink jet printers, optical electronic copiers, digital copiers, digital multi-function copying machine (copying, faxing, printing & laser scanning all in one), cartridge and relative electronic components. The company also sells its own products and provides relevant after service.

FuJi Xerox 7 Sustainability Report 2011 Focus Report

— Practice CSR in Company Activities

CSR means “to encourage a positive impact through its activities on the employees, consumers, environment, communities and stakeholders while make profit and embrace responsibility for shareholders whereby promoting the achievement of company's and social sustainable development.”

The focus report is themed at those most concerned by the stakeholders and introduction of our practices on CSR in 2010.

Building Harmonious Labour Relations Carrying on Cultivation Movements Multifarious activities in Manufacturing Department Union Activity

Progress of Environment Management Fundamental Strategy and Policy of Environment Management Goal and Achievement of Environment Management Sustainable Environment Management System Carrying on Environmental Protection Activity

Safety Management Policy, Goal and Achievement of Safety Sustainable Occupational Safety and Health Management System Education and Propaganda on Safety and Health

Promotion of Cooperation with the Suppliers Continuous Advance to CSR Procurement

FuJi Xerox Sustainability Report 2011 8 Build Harmonious Labour Relations Carrying Out Cultivation Movement

Enhance Workers' Cultivation, To Be NO.1 Enterprise Cultivation Movement aims at enhancing all workers' cultivation and attaining to be NO.1 enterprise. The company leaders take the lead and set an example, and all staff takes part in this movement, which still carries on.

Since the catchword of “Company As Exhibition Hall” in 2009, some phenomena, such as rubbish crowded, dust sticked to equipment, irregular dress, stained equipment and so on, are taken place many time when keeping company with visiting guests or in the regular top tour. After group discussion, the company decided to clear up all the disgusting phenomena mentioned above by a movement with all staff involved in. It is the so called Cultivation Movement.

The Ceremony of the Cultivation Movement 4th, Jan. 2011, the first working day of the new year. It was a rainy day with the outside temperature of 3 degrees. At 7:45, Okaji Toshihiko and other 22 managements showed their regards to every employee in the canteen gate of the Dahe factory. Some colleagues ran into the canteen shily while some said “good morning” back and this make the site full of greeting.

Morning greeting to everyone Greeting to everyone

The Cultivation Movement is the first movement of Fuji Xerox (Shenzhen) in 2011. In the business operation meeting not long ago, Okaji Toshihiko Chairman said "We should take the lead. Do it from the beginning of sending warm greeting." And everybody agreed on the proposal and then a decision of all the management sent regards to the whole staff at the first working day was made. And this is the beginning of the 3-month-long Cultivation Movement. To make the movement carried on extensively, the catchwords for the movement is: I participate in the Cultivation Movement! Cultivation Movement, to be No.1!

Carrying Out Roundly After that, all the departments immediately went into action. The leaders of the Product Department and the Logistics Department greeted every entering colleague smilingly at the gates of the factory. So are the leaders of the Facility Department, Technology Department and the Comprehensive Department who are on duty one by one. From that on, there are warm greets around the company which make communication easier.

Continuous Advance As the movement effect shown in March, 2011, the staff has been used to send greets to each other. The company manager kept on with the greeting movement at every Monday morning due to the increase of production and new employees, so as to increase more communication with every old and new employee.

Through the Cultivation Movement, the employees reacquaint their workplace environment and the surrounding cleaning and clear up are all finished completely. The behaviors unmatched the company rules are corrected and the tidy environment is obtained. Let's be a cultured!

FuJi Xerox 9 Sustainability Report 2011 Multifarious Activities of Manufacturing Department — Carrying out active activities in the second manufacturing department

In the fierce international competition environment, the enterprise survival requires humanist. Training and arousing employees' belonging, enthusiasm, initiative and creativity, all of these will be the important condition enterprises to get competitive advantage.

In 2010, in order to further promote the enthusiasm of the workers in second manufacturing department and to strengthen communication and exchange between superior and subordinate, in line with the full participation, going ahead and creating the harmonious characteristics of manufacturing team in mind, we conducted a series of active activities through the top down overall The lively safety knowledge competition planning and the spontaneous bottom-up way. Such as safety knowledge competition, polite learning activities, good proposal selection meets, earnest talks, and spontaneous activity the teams held in groups, etc.

In June, we organized "Safe Production" activity. Through lively education to all staff, knowledge competition, and especially the education for easy happening industrial injury to new people, we made everyone understand that we should avoid safe accidents completely. We not only should do according to safety standards, but should also understand why we do this and how to prevent the accidents. Through this activity the departments also implement the responsibility system for safety in production, clear division of labor and individual responsibility. Accident caused by careless mistake would be checked after all and would not be coddled. Meanwhile we adhered to the "people-oriented" management idea, in this way to promote the safety of the standardization of the safe and civilized production, and make the "safety first" Safe Production Work Place of Workers idea go deep into everyone's heart.

In order to improve the worker's civilization and etiquette consciousness, strengthen worker's individual moral, guide workers in developing a habit of modest comity. It facilitated to form a polite workplace atmosphere and set up a manufacturing field with a high degree ethics. In July and August, we carried out two-months "polite" learning activities. For individuals, civilization etiquette is external aspects of a person's moral, culture and communication skills. On the other hand, for the enterprise, civilization etiquette is the embodiment of a deep culture and good values of the enterprise. So how to improve the consciousness, strengthen the cultivation, develop habits, carry forward the enterprise culture and practice the enterprise values? For this reason, we carried out multitudinous and down-to-earth activities. Thousand Signatures for Good Manners Activity

By the propaganda and impetus of the management on the sense, workers at the production line participated in the “ thousand signatures for good manners activity” aimed at civility idea propaganda. The workers showed great enthusiasm and strong supported it. The etiquette knowledge training activity aimed at making workers master basic etiquette knowledge organized the group leaders and repairers to study, with a total of 221 person trips. Then they popularized the civilization etiquette knowledge Etiquette Knowledge Training

FuJi Xerox Sustainability Report 2011 10 to other employees after the training. And workers picked up faults of themselves and reflected in the “picking faults and criticizing personal bad habits activity” aimed at self-examination and self-discipline, around appearance, habit, dress, style of conversation and the way to get along with others etc., Carrying out of the other activities such as “reading then understanding”, “practicing good manners words”, Tissues littered on the ground. Snacking in the workshop “training sitting and standing” and “picking up trash omnivorously”, further strengthen the awareness and regularize words and deeds of all.

But, the improvement of moral cultivation and the development of civilization customs will take a long time. On the one hand, we will further strengthen civility education of new hires, and bring the content of civility learning into the basic education system Wiping hands with tissues Nodding off over the worktable of production workers. On the other hand, maintaining the public environmental Pointing out the personal bad habits and shortcomings quality of good manners and attainment required everyone's unremitting, spontaneous consciously self training and self-discipline.

In order to strengthen the communication between the superior and subordinate of the second manufacturing and develop the courage to tell the truth of the subordinates and the employees, we hold a monthly meeting charged by the Ministry. They listen to the views of staff from the field, guide people more concerned about their workplace,

explain the major targets of the second manufacturing department to the staff and the The Earnest Talk Chaired by Management headman, guide their employees in determining the life action and a plan to achieve personal dreams, and encourage more learning and more thinking and solve the confused questions raised by employees.

7 for manufacturing published said: I am proud to participate in the staff association meeting, together with my team members to carry out the task: Out of the inferiority complex and establish a high degree of confidence subject. The members make simple self-introductions respectively, and then a common discussion subject is picked up. The causes and solutions of the problem are analyzed with the common discussion.

By the group's discussion of the members, we shared our experiences with each other and learn from each other so that everyone learned a lot! It also made me deeply appreciate the fun and team strength. In modern society, it is an important cornerstone of "Get out of inferiority complex and establish a high degree of confidence" for us to complete our goal!

In order to encourage the courage of the grass-roots workers to propose the defects in working site points, to enhance the awareness and improve the level of workers, facilitate the exchange and learning, the Management Department held a monthly meeting of the excellent selection of activities to improve the proposal. Through selection, a number of excellent proposals and improvements have emerged to provide high quality, low cost and short delivery time of goods to the customers, which make a positive contribution to the company!

Discussing and Electing Excellent Improvement Proposal Group Photo of Prize-winner Excellent Improvement Proposal

FuJi Xerox 11 Sustainability Report 2011 Not only that, each group within the department also organized spontaneously various forms of activeness activities, such as barbecuing in the garden, New Year's Day wishes, etc

These series of activeness activities inspired the staff of the second manufacturing department to love their work and love life with a positive spirit. Then they made great achievements in the company competition in 2010.

Winner of the Mountain-climbing Competition Winner in Karakuri

Winner of the Sports Meeting Winner for Best Improvement

We believe that the second manufacturing department is bound to be a champion manufacturing team with mutual love, vigor, solidarity, advance bravely and perfect harmony. It will make more contributions to the company in the new year.

The year of 2010 is a year that the second manufacturing department achieved fruitful results.

In the past year, we almost won all the first rankings of the company in activeness activities. Such as the 13th Sport Meeting, the 4th Mountain-climbing Match, the first Karakuri Game and the 9th Improving Meeting.

Through all the competition mentioned above, the second manufacturing department displayed its potential and strength, and took a giant step forward to set up a strong, vibrant and great-hearted organization.

I hope one day, after our common efforts, each manufacturing employee can be to say to Ban Quanyong others: I am manufacturing, I am proud. Minister of the Second Manufacturing Department

FuJi Xerox Sustainability Report 2011 12 Trade union activities

— Harmonious Development and Creating a Better Future Together

Fuji Xerox (Shenzhen) Trade Union is leaded by the superior T h e Tr a d e U n i o n o f F u j i X e r o x ( S h e n z h e n ) a i m s a t union and taken the policies stipulated by the Federation of popularization, democratization and legalization, then carry Trade Unions in Shenzhen Municipal during the activity of the construction of the trade union forward. Solving problem “Mutual Love from Both the Enterprise and the Workers” honestly for the workers is the starting point and the foothold as guide. Focused on the corporation's target and based on its of the union since workers are the trade union's service object. own characteristics, the trade union fully arouses workers' According to the hot and difficult problems in the development ability and cleverness, forges ahead and keeps pace with the process of the company, the trade union propagates national times. It strengthens its own construction, acts as a bridge laws, regulations and the rules of the company through posters, between the management and the workers, invents new methods understands the workers' idea through discussions and interviews. to work, enhances cohesion and fighting capacity of workers, Starting from caring about and understanding people, it resolves and at the same time pushes democratic management, quality contradictions, straightens relations, calms workers down and of labour force projection and corporate culture construction supervises the company to abide by laws and regulations. Ways forward. In the result, the trade union makes a proper to resolve the contradiction are humanized and preconditioned, contribution to the social and economic transition of the and make the protection of legitimate rights and interests of corporation after the financial tsunami. workers maximized. At the same time, it mobilized broad masses

Under the concern from the corporate leaders and the support from all departments, the commissioners and members work hard together to promote harmonious labour relations and safeguard workers' rights. Since 2010, in order to make its work gets used to the new condition and further play the role as a bridge and link, the trade union has strengthened communication with workers and policy promotion, making use of the company internet websites, suggestion boxes and posters. In 2010, it received 113 suggestions from workers, and had informal discussions and interviews 20 times. Then those suggestions and questions were classified, followed up and disposed by specially-assigned person. Moreover, the trade union transfers The Mid-Autumn Festival Party

of workers to believe that the company would have a great future and support positively and then throw themselves into the company change. Combined with the carrying out of “Sending Warm” and “Mutual Love” activities, focuses on the practical difficult workers meet, the trade union expressed sympathy and solicitude for the workers with different difficult, and helped them, who then felt the party and the government's care and warmth. In 2010, the trade union provided 30 workers with subsidies, based on RMB30,000 consolation money from the superior Union and RMB20,000 raised by the itself. In this way the union both reduced the company's burden and stabilized the workforce.

Company Sports Meet To enrich workers' cultural activities and meet their demand workers' request to the top of the corporation directly by of spare-time culture life, the trade union played to its advantage regular Board meetings. The trade union committee holds to organize a series of brilliant activities. There were more periodic policies and regulations study group meetings to than 20 activities, including a trip, gifting moon cakes on the enhance mass, responsibility and service consciousness of Mid-autumn Festival, various types of recreational activities the members further, and improves the comprehensive in festivals and fellowship activities, and no less 30,000 person- quality. time attendances every year. The trade union organized many

FuJi Xerox 13 Sustainability Report 2011 sport clubs to select, train and have matches inside the company, the trade union committee would, as always, improve their thereby took more workers participating in the construction of own policy level, rich working methods, further change ideas, corporate culture. In 2010, the Dancing Team took part in 20 emancipate the mind, keep pace with the times, meet new artistic performances at the municipal, district, and sub-district challenges with a new thinking, new style and new methods levels. Meanwhile The Football Team, The Basketball Team, of working, and strive to create a new situation of the trade The Badminton Team and The Dragon Boat Team etc. union's work. participated in more than 80 competitions at the municipal, district, and sub-district levels, and won the champion at different levels no less than 10 times. Further, annual Athletic Meeting and Mid-Autumn Festival Party were a stage for workers. The trade union ordered group train tickets for workers, and then sent them to Shenzhen, Dongguan and railway station free. It resolved workers' real difficulty, and was praised by them. Through the carrying out of the recreation and sports activities loved by the masses, it made every worker away from bad thoughts.

Wang Zhihui Chairman of Fuji Xerox Shenzhen Trade Union

In the trade union work, we never failed to feel the great responsibility and task glorious. Serving employees, promoting company development and contributing to society are our undying work target and direction. In Company's Football Team Members the new period and the new environment, we will “To be good” is always implemented in the work of trade promote the sustainable development of the company, union: it got the more than ten honors at the municipal and construct harmonious society and contribute all our d i s t r i c t l e v e l s , s u c h a s “A d v a n c e d Tr a d e U n i o n”, strength with new thinking, a new style and new “Advanced Unit” and “Outstanding Workers' Home” etc., methods of working. and 20 honors at sub-district level. In 2010, it input RMB 60.000 to further consolidate and improve the construction of “workers bookstore” listed by ACFTU of listing, bought more than 2000 volumes of books and more than RMB 300,000 to renovate and maintain the sports facilities in internal soccer field, basketball, tennis court etc of the company. Make the company hardware facilities mounting a new step.

Taking the actual situation of almost half of the female workers into consideration, the trade union did well in the women self-esteem, self-reliance and self-love education work, cared for female workers, carried out the "Women's Civilization" activity, and fully mobilize the enthusiasm and dedication of the female staff. It both won the municipal and district awarded “38 red flag”. At the same time the third manufacturing group of the first department was honored with a title “Shenzhen Women's Civilization”.

While giving full play to its advantages, the trade union committee always served the interests of workers and the sustainable development of the company. In the future work

FuJi Xerox Sustainability Report 2011 14 The Promotion of Environmental Management

Basic Environmental Strategy

Environmental Management █ Environmental Policy Policy █ Environmental Target and Achievement █ Environmental Promotion System System █ Environmental Management System █ Environmental Education Strategy █ Environmental Communication █ Environmental Award Scheme

Major Programmes

Global Warming Exhausted Nature Resource Eliminating Harmful Chemicals

Products Environmental Improvement in █ Green Products and Eco- Business O peration Produce Process

Prevent Global Wa rming Resource Conservation and Waste Recycle Business Operation Reducing Hazardous Wastes Recycling Resources

Eliminating Harmful Chemicals G re e n P r o c u r e m e n t Management of Chemical Substances

Environmental Policy

Being a long-term vision of ecological safety, building up a society for sustainable development is the solid foundation of ecology and safety principle established in Fuji Xerox Co. In 2000, Fuji Xerox of Shenzhen Ltd. formed its own environmental policy in accordance with the Group's ecology safety principle.

Greeen Policy in Fuji Film Shared Value (Environment) in Fuji Xerox

Concept

Long-Term Vision of Ecological Safety in Fuji Xerox

Reificatio

Principle of Ecology and Safety in Fuji Xerox

Environmental Safety Policy in Fuji Xerox of Shenzhen Ltd. 《revised 2009》

On the basis of the ecological safety principle of Fuji Xerox Co., Fuji Xerox of Shenzhen Ltd. puts forwards the idea of environment protection and safety management into the research, development and product producing covered digital laser printers, digital solid inkjet printers, digital copying machines, digital multifunction devices and other wide format plotters. To reduce pollutions and protect our shareholders' benefits, the company has formulated the following policy: Improving the performance on environment and safety consistently in accordance with relevant national laws, regulations and requirements related to environment and working health and safety; Insisting the aim of 'zero landfill' by resource conservation, reduction of waste emission, strengthening the management of chemical substances and preventing environmental casualties; Carrying forward the safety management to prevent and reduce the possibility of work accidents and reduce occupational injuries; Implementing internal auditing to maintain and improve management systems of environment and occupational health and safety; Intensifying education of employees on environmental protection and health and safety so as to actively pursue synchronous progress with others in the edge of the company; Unveiling this policy to all company staff and the public in written form.

FuJi Xerox 15 Sustainability Report 2011 Disclosure of Environmental Information

Item of Environmental Burden Unit Fiscal Year 2004 Fiscal Year 2005 Fiscal Year 2006 Fiscal Year 2007 Fiscal Year 2008 Fiscal Year 2009 Fiscal Year 2010

Castoff

Total Amount of Emissions t 2,982 3,356 3468.7 5061.8 4755.9 5010.0 5980.3

Resource Recovery t 1,796 2,688 2606.5 3767.1 3347.5 1839.2 1681.3

Burning Regeneration t 1,186 668 862.2 1294.7 1408.4 1762.0 2120.8

Total Amount of Recycling t 2,982 3,356 3468.7 5061.8 4755.9 5010.0 5980.3

Landfill t 0 0 0 0 0 0 0

Combustion Disposal t 0 0 0 0 0 0 0

Recycling Rate % 99.5 99.5 99.5 99.5 99.5 99.5 99.5

Energy

City Electricity Consumption Kkw/h 3,483 5,439 18,222.9 21527.1 22652.8 39355.6 43325.1

Generating Capacity Kkw/h 13,357 15,065 5,456.2 5377.1 4590.2 48.0 19.2

Diesel Usage KL 3,924 4,094 1,473 2002.9 1362.8 201.3 151.2 LPG Usage K M3 89 102 217.7 296.3 330.8 404.9 451.3

Total Amount of CO Emissions *1 *1 2 t-CO2 14,281 16,637 23058.3 27631.8 26864.6 31810 34850

Water Resource

Tap Water Usage Kt 159 216 235.8 289.1 307.7 453.5 499.1

Ground Water Usage Kt 117 122 107.8 85.9 71.6 69.9 11.8 Total Water Resource Usage Kt 276 338 343.6 375 379.3 523.4 510.9 *1 calculation is in term of new index

Environmental Expenses

Expense Facility Other Cost Economic Project Item Depreciation (Labor Cost and Achievement category Investment administrative Expenses) Effects Applying Refrigerator Flexibly, Energy Saving, Reducing Co Emissions; Reduction of CO2 3,064,933 1,021,644 138,364 6 7,848 2 Installing Fluorescent Light Honored as the Demonstration of Energy Emissions Baffle-board, Centralized Control of Air-Conditioning, Solar Water Heater Conservation and Rewarded as “ Cost for Installation, Improvements of Pengcheng Advanced Enterprise in Energy-Saving etc. Waste Reduction” Achieving Environmen Reduction of Water Water-Saving Maintenance 0 80,785 Water Saving tal Targets Usage

Facilitating the Achievement of Reduction of Castoff Purchasing Garbage Cans 27,650 9,217 “Zero Landfill” Sub-Total 3,092,583 1,030,861 219,149 67,848 Preserve Management; Raising ISO14001Maintenance The Promotion of Environmental 0 0 2565,132 Employees' Awareness of and Management Protection Activities, Environmental Monitoring, and Exchanges etc. Environmental Protection

Special Training of Career Raising Employees' Awareness Application of Education, Cleaning Production, 0 0 156,528 of Environmental Protection Environmental Education Saving Energy, Chemicals and Maintenance Solid Wastes etc. Expenses for Virescence Management Virescence Entrustment 118,900 Embellishing Environment Environmental 0 0 Management Hazardous Wastes Treatment, 0 0 681,123 Guarding Against Pollution of the Response of Environment Living Rubbish Cleaning and System Regulations Soil; Facilitating the Achievement Noise Abatement etc. of “Zero Landfill” Environmental The Production and Audit of Information Disclosure Environmental Reports 0 0 36,800 Unveiling Information to the Public

Activities of Social Environmental Summer Camp, 0 0 29,200 Upgrading corporate Image Contribution Activities of LEAFX and Other Environmental Campaign etc. Sub-Total 0 0 1,278,683

Compensation Pollution Repair Expenditure Nil 0 0 0 for Environmental Sub-Total 0 0 0 Damages

Total 3,092,583 1,030,861 1,497,832 67,848

FuJi Xerox Sustainability Report 2011 16 Sustainable Management of Environmental Management System

Environmental Management System is a base for pushing environmental management tasks. Under the environmental management philosophy of Fuji Xerox Go., Fuji Xerox of Shenzhen Ltd. attaches great importance to environmental management since it has been established. In 2000, the company acquired the certificate of ISO14001. Within a long time, the company has taken its social responsibility of sustainable development via improving internal management system, and promoting the relative work in many ways such as energy saving, reduction of resource usage and hazardous chemicals etc.

Initiate Environmental Protection Activities

Leaf x is short for Love Earth Action Fuji Xerox, and Leaf is the meaning of“leaves”and the X on the upper right corner means “power”. The company hopes that everyone's activities will persist like a lush growth of trees and everyone makes efforts to

protect the global environment. Additionally, it represents an expectation of reducing CO2 emissions since plants can absorb carbon dioxide and release oxygen through photosynthesis.

The Leaf x activity which carried out by ALL-FX in 2008 is a large-scale environmental protection activity with the purpose of energy saving, low-carbon life, biodiversity and resource protection. It has all its employees and their families from all locations participated in and promotes in regions of every subsidiary widely.

In 2010, Fuji Xerox of Shenzhen Ltd. carried out the activity in different forms and with the different themes in the company. Employees and their families participated in the activity in a variety of ways, which got company-wide enthusiastic responses and active participation. There are cumulative total of 2650 person-times to engaging in activities. On the basis of last year, the participation rate increased by 18.8%. T r

1. Tree-planting Activity on 17th April e e - p l

“Green and Harmony Shenzhen” Tree-planting Activities a n t

th i n

was held at the Lotus Hill Park in Shenzhen on 17 April, 2010. g A c t i

There were 30 employees participated in the activity. v i t y o n 1

2. World Earth Day Activity 7 t h

nd A

22 April is Earth Day. In order to strengthen employees' sense p r i of “Cherish the Earth's Resources”, the environmental l protection thesis collection entitled “Low-carbon Life, Me in Action” was carried out. In the activity, the experience V i s

of environmental protection was shared. It collected six i t i n essays and issued special souvenirs. g E n v i r o n 3. Visiting Environmental Protection Exhibition m e n

th t a

The 8 China (Guangzhou) International Environmental l P r

th o t Protection Exhibition was held on 9 June in Guangzhou. e c t i o

The department of CSR organized 28 environmental n E x h

promotion employees from different department to visit the i b i t i o

exhibition and study to learn about the latest results of n environmental protection and widen the environmental protection train of thought.

FuJi Xerox 17 Sustainability Report 2011 4. Knowledge Contest on Environmental Protection On 29th June, the company held a knowledge contest on environmental protecti on entitled “Green Asian Games, Low-carbon Life” to respond to the call of Center for Environmental Protection Education & Communications of Guangdong Province. The center handed out 100 answer sheets, which got strong support from the staff. The response rate reached 100%.

On 30 th August, the company held an activity of reciting for the prize about environmental protection safety policies to improve the employees' understanding of the company's environmental safety policies and to display the guidance role Draw Card of Knowledge Contest on Environmental Protection of the policies effectively. According to statistics, 479 people participated in the activity on that day. Most employees mastered the policies.

5. World No-Vehicle Day Activity 22 nd September is the 11 th World No-Vehicle Day which advocates “Green Transport·Low-carbon Life”. After “Green Action Day” on 11th June, the company continued to carry out this activity. 68% employees who normally drive private cars responded to the advocacy and chose the company vehicle or Reciting For the Prize about the Safety other public transportations on that day. Policies of Environmental Protection

6. Making Environmental Protection Christmas Tree At the dawn of Christmas, CSR department carried out the activity of making Christmas tree by reclaimed waste optical discs on 10th December. The activity not only added the Christmas atmosphere, but also hoped to improve the environmental awareness of all employees.

As an information carrier, optical discs are becoming increasingly popular in people's life. It also brought about waste and environmental pollution. It is to reduce waste and raise the utilization rate of resources by making environmental protection Christmas tree. The top height of the Christmas tree is 3.3 meters, made by 888 waste optical discs. The

“FXSZ” and “2011” in the tree were made in four colors. “Environmental Protection Christmas Tree” [FXSZ is short for Fuji Xerox of Shenzhen Ltd.] was made of waste optical discs

7. Saving for Better Earth Activity On March 14th 2011, the company launched a “Saving for Better Earth” activity which made propaganda for the methods and significance of saving water, saving electricity and garbage classification etc. by means of poster, banner towing, live answer etc.

8. Earth Hour Activity “Earth Hour” was carried out between 20:30-21:30 on March 26th 2011. Employees Saving for Better Earth Activity were asked to switch off lights for an hour. It advocated employees to carry out the activity in their families or dorms and also proposed personal environmental protection commitment. After the activity, 13 employees submitted their thoughts about the activity and personal environmental protection commitment. The company chose one first prize, one second prize and one third prize from all and granted souvenirs as encouragement.

“Candle Lamp” Made by Waste Plastic Bottles

FuJi Xerox Sustainability Report 2011 18 Safety Management Safety Policy, Target, and Result

The company proposed the policy of “Safety first” in 2010 to insure employee's safety and health, reduce the industrial accidents and challenge “Zero-accident”. “Zero-accident” safety management idea means to reduce accident hidden troubles, remove hidden dangers and mitigate loss to a bare minimum aiming at making occurrence of accidents and loss approach “zero”.

In order to achieve the goal of “Zero-accident”, and against a series of objective reasons, for instance, employee turnover rate increases greater this year than the previous year, a large number of new employees are not familiar with the environment, and the safety awareness of some employees remains underdeveloped, CSR Department appropriately carried out KYT Education, Equipment Safety Evaluation System, 10s Inspection System, etc. The strong supports and cooperation makes work-related injury frequency rate in 2010 reduce 70% by comparing with the number in 2009.

35 33 1.40% Work-related Injury Trends 30 1.20%

Number of times a work- Average Rate of personal 25 related injury occurs work-related injury 1.00%

20 0.80% 14 14 15 0.60% 10 10 8 7 8 0.40% 4 5 3 0.20%

0 0.00% 2002 2003 2004 2005 2006 2007 2008 2009 2010

KYT Training Promotion

KYT (Kiken-yochi training) means to conduct drillings of foreseeable dangers before they happen and take preventive measures. KYT is a safety education and training activity against the characteristics of the production and the whole process of operation procedure, regarding its risk as object and operation groups as basic forms. It is a kind of masses “self-management” aiming at controlling the risk during operation procedure, predicting and preventing possible accidents.

In fact, Kiiken-Yochi Training (KYT) is a training to solve problems (risk) by all employees or someone in short time. That is to say, it is a short time risk prediction activity for safety prevention. In order to prevent man-caused accidents occurring in the first production line and The first group training insure the safety for every day and every moment, employees need to independently identify, master and solve the hidden dangers in job- tasks and operation as well as carry out group work of risk prediction to improve risk perception, risk attention and problem-solving ability of every operator and increase enthusiasm to put it into practice.

The Safety Promotion Department of corporate conducts trainings for 298 KYT representatives from various departments in four times. These representatives are back to their departments to train the employees within the department when they have finished the training themselves, a total of

6714 participants KYT training. By BYT training, the ability and awareness Group training and discussion of employees to identify and solve safety problems has got improved.

FuJi Xerox 19 Sustainability Report 2011 Equipment Safety Evaluation System In order to remove equipment safety risk and reduce work-related injury and safety accidents caused by equipment as much as possible, and according to the requirement of Production Safety Law: if a production-operation unit employ new procedures, new technologies, new materials or new equipments, it needs to learn and master the safety characteristics, take effective preventive measures and carry out specialized education and training for operators. After the new production equipment, improved production equipment and modificated production equipment are put into production; we should identify, insure and evaluate the risk of the equipment itself and the risk caused by surroundings or operators during the operation to make it easier to take timely actions to improve, prevent and reduce accidents during the production and protect the safety of people and property.

According to the statistics of Safety Promotion Section, there were 962 facilities totally in need of evaluation. The evaluation of the equipment was done lead by Safety Promotion Section, with security officers of different departments, facilities management personnel and operators participated in, and the identified security risk had been improved and the safety of equipment was enhanced.

10S Tour System 10S is the abbreviation of Seiri, Seiton, Seiso, Seiketsu, Shitsuke, Speed, Save, Security, Safety and Smile.

Before April 2010, 10S Tour was carried out by clerks from different departments and STAFF to conduct an inspection for every department. Since the participated members' ability of identifying problems was insufficient and realization degree within the departments was not enough, the same problems recurred, and the improvement could not be made within the given time.

In order to standardize 10S Tour System, to discover and remove hidden dangers in time and to prevent work-related injuries and safety accidents, the company re-established a new 10S Tour System 10S Tour chiefly based on Controlling Department director and ministers. The system had achieved an obvious effect after introduced for six months. However, there were fixed TOP Tour on Wednesdays and 10S Tour on Tuesdays or Thursdays which caused to increase corresponding time of departments and make all kinds of tours happen too frequent. Based on the consultation of company's top management, 10S Tour and TOP Tour were merged into a new 10S Tour System consisted of general manager, directors, Controlling Department director and ministers, and the system was to put into practice in December of 2010. Three months later, a total of 443 problems about various 10S were found, in which safety, finishing, and rectifying problems occupied 80%. Through all departments' improvements, the squalor and disorder on site and in office building had been significantly improved and 276 various safety risks had been eliminated.

Sustained Development of Site Tour Activity Besides 10S Tour, safety officer tour and other regular tour systems, the company continued to implement site irregular confirmation developed by CSR Department to strengthen the confirmation on security condition of operations where accidents happened easily and often. As to the identified problems, we helped the operators to improve. The top management of the company spared no effort to improve safety problems, and the top management led by chairman pointed out the problems to the minister on site identified during the tour. In addition, the top management required the officers of Affair Bureau to record the problems and keep on tracing until good effect of improvement was achieved.

Being the first foreign enterprise, the first enterprise of Shenzhen and the first enterprise of printer industry accredited at the first grade on safety, in order to make the company play the role of initiators, government leaders often asked security experts to visit and check the company and give valuable suggestions on safety management.

Health Management —Health Examination for Those in Hazardous Positions As the positions in the company were easily to contact chemicals and noise, it possessed many workers in special positions. In order to make sure the pre-employment, on-job, pre-department and retiring health examinations were abided by the relevant regulations; CSR Department associated with Liaison Department and constituted standardized electronic process of health examination for those in hazardous positions, enhanced communication in their daily work and timely solved the problems arising in the process. Throughout 2010, approximate 1,400 people went for occupational health examination in which 120 people of occupational disease were found in the pre-employment examination. In accordance with law of Prevention and Control of Occupation Disease, all of these people were rearranged at different posts. Here no staff afflicted with occupational diseases has been found to this date.

FuJi Xerox Sustainability Report 2011 20 Air Quality Monitoring in Workshop The quality of air condition plays a vital role in determining personal health status. The initial objective of air quality monitoring is to know if all factors in workshops meet the national occupational health standards. Then it also aims to analyze the trend and range of concentration change at any point and to determine the effective means. As a result of these, the enterprise invites qualified agencies to make regular environmental inspections annually, and discloses results to all staff. For the area beyond the norm, effective measures including improvement programs of replacing and eliminating and personal protective equipments have been adopted to ensure employees' health and safety. Air Monitoring

Publicity and Education of Occupational Health and Safety With the development of the safety management, the concept of “Safety First” has been a will for every employee in the company. However what is the true meaning of “Safety First”? How to define a safe status? What are the responsibilities of all ones throughout the corporation? In the concept of “Safety First” proposed at the beginning of 2010, the chairman required managers to master certain of specialized knowledge about safety management. Based on the principle of production management with safety management, we should guide employees to perform in their daily life. Only let everyone know what they should do, can safety production be realized. In order to assist site office with safety production, CSR Department proposed a series of programs, involving new staff safety education, publicity posters posting, video education, specialized safety management training, etc.

● Aiming at making safety atmosphere denser in company and improving employees' safety awareness, the company worked with Administrative Safety Supervision Department and independently bought publicity materials. The company also posted various safety publicity materials on board and updated them in time to let employees learn practical safety knowledge. ● In October of 2010, the company divided the leaders of teams into four to carry out safety quality improvement education, and 228 people were trained. ● To expand the security managerial ability of administrators, the enterprise commended professional lecturers to conduct a one-day course for mangers in Production and Logistic Department in August of 2010. During the course, all people listened carefully, actively participated in discussion, expressed their views and presented their doubts to lectures about their daily management. We concluded that the training achieved good results from the post-training survey.

Safety Management is an odyssey far from finished.

A remarkable improvement has been made indeed with the high level affirmation and full cooperation in the enterprise. The duties, powers and business are divided more detailed than before, everyone minds their own business, does their best and with their whole hearts to achieve “safety production”. We can feel dense safety atmosphere in every workshop of the company. In the future, we will continue to regard “Zero Injury” as the goal, pragmatic attitude as principle to do safety management better.

Safety training for the leaders of teams

FuJi Xerox 21 Sustainability Report 2011 Co-operational Promotion with Suppliers —Continuous CSR Procurement

Preface: with the prevailing of Corporate Social Responsibility (CSR), we realize that fulfilling the promises on CSR does not narrowly refer to donation or public-benefited marketing, to a deeper degree, it is to respect human right, cherish safety and health, protect environment, guarantee quality, ensure information safety, compliance with ethical principles, legally pay taxes and other content. We further realize that as every company exists in a supply chain of supplying and purchasing, and no company can survive independently, thus to promote CSR inside a company is just one part of performing the responsibility while to plant the CSR concept in the whole supply chain can be called as real implementation. Therefore, it is not enough for a company to manage its internal affairs it should expand its influence to the whole supply chain.

Holding the philosophy of “Study Together, Develop Together, Become Strong Together”, the company is targeted at establishing a cooperation partnership rooted on trust and responsibility to promote the sustainable development of the whole society.

“Study Together, Develop Together, Become Strong Together” can be interpreted as discovering problems, sharing information, making improvement together to become strong together.

Main items which are visited and judged by suppliers have grown from 58 to 132 in 2010. The contents involve the following aspects.

Item Contents Environment1 Prevention of Global Warming Environment2 Energy-saving Products(Control the Use of Natural Resources) Environment3 Recovery and Proper Disposal of Wastes Environment4 Chemicals Management Environment5 Protection of the Natural Environment(Biological Diversity and Ecosystem) Environment6 Administrative Formalities Environment7 Obtainment of EMS Third-party Certification Environment8 Encouraging and Promoting the Company's Suppliers Labor1 Eliminating Forced Labor or Child Labor Labor2 Eliminating Discrimination and Invasion of Privacy Labor3 Eliminating Workplace Violence, Sexual Violence, Sexual Harassment and Unreasonable Punishment Labor4 Rationalization of Payment, Working Hours and Off-work Day Labor5 Protecting Workers' Rights of Solidarity and Collective Bargaining Labor6 Workplace Environmental Management Labor7 Management of Illness, Injury and Health Labor8 Health Care Facilities and Well-being (Dormitory and Canteen) Labor9 Cultivating Talents Labor10 Obtainment of Third-party Certification Labor11 the Requirements of the Company's Suppliers Business ethics1 Management of Business Ethics Business ethics2 Preventing Corruption Business ethics3 Protecting Intellectual Property Rights Business ethics4 Ensuring Fair Procurement Business ethics5 Improving Reporting (Internal Communication) System Business ethics6 Improving the Information Security System Business ethics7 Encouraging and Promoting the Company's Suppliers

FuJi Xerox Sustainability Report 2011 22 The diagnosis sum-up meeting of suppliers' CSR procurement and visit

We visited 13 suppliers in 2010 and got their active cooperation. Suppliers' understanding of CSR has been further improved.

With the promotion of CSR procurement, we have comprehensively known the management of suppliers' human right·security, environmental protection and health. Greater promotion has been made on environmental protection and business ethics, while many problems exist in human right·security, especially the shortages of the occupational hazard management.

The Distribution Diagram of Charge Field in Visit Diagnosis

66 47

Environment Human right Business ethics

145

For suppliers, after several years' project implementation, suppliers actively practiced and changed their previous management patterns. It was generally believed that the activities were vital to the future development and sustainable development of the company.

For Fuji Xerox of Shenzhen Ltd., it strengthened the management of supply chain by means of propagating the idea of corporate social responsibility and improved company's competitiveness and industry competition power via combing the upriver and downriver industry, which achieved the partnering relationship in the real sense and strode a firm step to “Study Together, Develop Together, and Become Strong Together”.

In the process of promotion, we found shortages of the occupational health management existed in many suppliers, which existed great business risks. With the principle of discovering and solving questions together, Fuji Xerox will treat suppliers' questions as their own and hold a learning meeting in 2011 on the occupational health for suppliers to help them really solve questions.

Besides actively promoting corporate social responsibility in supply chain, Fuji Xerox of Shenzhen Ltd. also hopes these corporations promote the concept in their supply chain-----the promotion mode spreads corporate social responsibility endlessly.

FuJi Xerox 23 Sustainability Report 2011 Legal Compliance,Sincerity and Reliability

—Continuous Advance to Internal Control System

“Observing law and discipline, being honesty” is one of the basic Codes of conduct for every large enterprise, working basis to the companies' management, and basic guarantee for the sustainable development of the company. Observing law and discipline means to run the business by law and manage with the standardized system. Integrity is also an important component of a corporate culture, which can effectively prevent and reduce various compliance risks.

The internal control evaluation of the Monitor Department is to oversee whether different departments based on the principle “Observing law and discipline, being honesty” to operated specific business with financial reporting data or not. In August 2006, the Japanese government issued Financial Instrument Trading Act (J-SOX) and in May 2008, the Ministry of Finance of China jointly issued Fundamental Plane on Corporate Internal Control (C-SOX), which pointed the way for internal control.

So what is internal control? (According to J-SOX Act)Internal control refers to the structures and procedures established within the company for carrying out commercial activities fairly and effectively. Specifically, internal control is aimed at four objects covering legal compliance, business efficiency, accurate financial report and capital preservation. It starts from the six basic components of environment control, risk assessment, activities control, information communication, activities monitor and IT application to construct the internal control process and assess it. Moreover, the object of enterprise strategy is added in C-SOX. At present, the internal control evaluation of the Monitor Department is still conducted in accordance with J-SOX.

Basic Components Content

Control Environment is basic to determine organizational climate, affect 1 Control environments employees' control awareness of the company and other components of Internal Control.

Risk Assessment means a serious of process of depending on the identification, 2 Risk Assessment analysis, assessment of all risks which affect the target of company to make correspondence of related risks.

Control Activities means the policies and methods made for insuring the orders 3 Control Activities and indicates of the manager to be fully obeyed.

Information & Communication means to ensure the necessary information to 4 Information & Communication be well-timed and accurate relayed in the company and between members.

Monitoring means the process of continually implementing the monitoring 5 Monitoring and evaluating of the effectiveness of Internal Control

IT applying means a series of flexible IT application of giving well-timed 6 IT APPLYING information in business for insuring other components' effectiveness of Internal Control.

( The six basic components of J-SOX )

FuJi Xerox Sustainability Report 2011 24 Management is the eternal theme of enterprises, and internal control is the inevitable product of enterprise modernization management. The development process of internal control evaluation activities carried out by the Monitor Department are as follows:

Under the guidance of the overall project of the parent company, September 2006 we identified the project objectives and the scope of the project, set (introduce internal control ) up the work group and decided the implementation plan.

The perfection of internal control object, the documents of the October 2006 business process, the flowchart, the risk-control matrix diagram and (Documentation) the regulations of internal control.

Through the first evaluation conducted before the adoption of J-SOX Act, April 2007 we mastered the company situation, come up with the topics which need (First evaluation) to improve and prepared for the enacting of the officially responded act.

According to the specific requirements of J-SOX Act, the evaluation 2008 was conducted. (the first year responded to the act) The result of internal control related to financial reports was there were ten points criticized effectively and weakly.

2009 The efficiency and standardization of operation evaluation. (standardization of operation The result of internal control related to financial reports was there evaluation) were seven points criticized effectively and weakly.

2010 FXSZ became the base of the internal management of J-SOX formally. (internal management of The result of internal control related to financial reports was there operation evaluation) was one point criticized effectively and weakly.

2011 Flexibly apply the internal control to other business processes other (the business development and than the process related to financial and continually improve the continual improvement) activities of internal control.

The development process of internal control evaluation

From the development process of internal control evaluation from 2006 until now, we can conclude that criticisms related to financial reports reduce year by year, but the awareness of enterprise's risk management can not be ignored. In fact, there is close relations between the internal control evaluation of the Monitor Department and risk management. Both of them are from the point of view of risk to find and identify risks and set related control policies to prevent. However, in actual business, we find that the risk awareness of business management is not strong enough and the risk may relate to law, management, efficiency, assets, etc. Although the internal control is limited by financial reports (such as financial related accounting controls and auditing activities, etc.), according to J-SOX, risk assessment of its constituent elements is very important and is one extensively used element. From the perfection of internal control, internal control and risk management are approaching and appearing the integration trend, that is to say, the company is led by risk management to establish new internal control for enterprise risk management strategy. Therefore, with the gradual improvement and extension of internal control, we will go dabble in law-abiding, assets preservation, efficiency promotion and so on. For instance, under the guidance of Fuji Xerox last year, we tried to take self-monitoring of manufacture and development, Monopoly Law, Company Law, Trade Law, Environment Law, Labor Law, etc. In the future, our goal is to realize the maximization of corporate value by ERM (Enterprise Risk Management).

□ The evaluation and correspondence of □ Enterprise Risk Management risks is the basic components for Internal √ Taking effective integration for the assessment and correspondence of Control. all risks affecting enterprise strategy and financial target □ The target of ERM

e √ The contribution of operational √ The increase of business efficiency rts nc po lia objectives Re p ficiency al om Ef nci l C ina ga √ To make sure credibility of √ To ensure legal compliance F Le Business financial statements Enterprise value Control Environment

Risk Assessment Corporation comprehe- nsive risk management □ ERM Control Activities Dedication to business target □ Risk-center performance Information & Communication evaluation Management of ethics Monitoring (information security, □ Integration with other ethics activities labor safety)

Preparedness of top □ Efficiency, evaluation and improvement of business (efficiency business other than financial reports of business) □The duty of giving information of □ Strengthening the evaluation of applying and preparedness Finance and busines s of internal control related to financial reports securities risks hostling Japan SCM Time

The relation between internal control and ERM

FuJi Xerox 25 Sustainability Report 2011 Green Production Control of Hazardous Chemicals

Green environmental protection is the principle advocated and followed by Fuji Xerox Group. The green production with the purpose of producing environment-friendly and resource-conserving products makes a steady step forward to earnestly implement of the principle. Fuji Xerox of Shenzhen Ltd. has stumbled 15 years in this long way since it took root in Shenzhen. The company achieved certain results in green production in 2010.

1. All Products XRF Testing The Test Data Trend Chart over Years of Fuji Xerox 80000 (XRF: the Abbreviation of X-Ray Fluorescence Spectrometer) 70000 75555 As one of the important means of controlling of the green 60000 61569 50000 47638 production, All Products XRF Testing has evolved through three 40000 42900 30000 35699 20000 stages: fumbling, fixing and standardization from its beginning. 19254 10000 Through constantly improving business processes and operation 0 3906 2004.10 12 2005 2006 2007 2008 2009 2010 methods, gratifying scenes of interactive automation of testing ~ information, visualization of sample management and efficiency of personnel operating were basically realized at present. Under the circumstance of personnel and machine almost did not change, annual measurements average rose 20% than the previous year for 3 years to effectively ensure the achievement of the goals of green products.

Okaji Toshihiko president Awarded for The Laboratory International standard Laboratory

2. The Completion of Laboratory In the past, many tests needed to be done to the same commodities every time to ensure the products to be in accordance with local regulations in the process of selling worldwide. With the promotion of Fuji Xerox Group, the completion of standard laboratory of the company was audited in 2010 by BELAC of Belgium, a member body of ILAC. In June 2010, it passed the audit and obtained international recognition qualification. The report the laboratory issued would have international credibility. (ILAC is the abbreviation of International Laboratory Accreditation Cooperation.)

From now on, the company's commodity will circulate all over the world with the report, which not only ensures the smooth flow of goods in places of sale, but also reduces the cost of testing and improves the time to market.

3. Major Training and Educational Activities Records ★ Intra-firm Education To raise the knowledge of ROHS Management System of each responsible person in technology center, the company held a ROHS response educational meeting for all staff in technology center. Group Photo: the Academic Society of Suppliers ★ The Response Education for New Environmental Regulations In October 2010, the company appointed someone to participant in the JAMP MSDSPLUS introducing educational meeting held in the head office in Japan to respond to European Union REACH regulations and give directions to suppliers to meet every requirement of Fuji Xerox Group. In late November, the company conveyed the proper methods and techniques of MSDSPLUS to the representatives of the participating suppliers in the special illustration meeting for South China suppliers. ★ Suppliers' Visit and Communication In February 2011, on suppliers' request, we shared the control system and XRF testing technique with the visiting suppliers and explored the problems in green production with them.

Looking forward to the future, the green environmental protection is also very important to us. We try our best all the time to ensure our products to meet the requirement of environmental protection regulations. But achievements belong to the past. With the full support of company's leaders and every department of the company, we will make our efforts to create a better future.

FuJi Xerox Sustainability Report 2011 26 Certificate of resource conservation products

With the concept of energy saving and environment protection, the products designed and produced by Fuji Xerox were in the leading position of its profession with the features of high efficiency and low-consumption.

By taking the Fuji Xerox (Shenzhen Ltd.) product, DocuPrint C830, for instance, it was certificated by Eco-Mark certification in Japan and Energy Star in U.S. in August 2000 and later gained the Eco-Label Award in Taiwan in September 2003. In addition, DocuPrint211 produced by our company won the prize of energy conservation by Japan Energy Conservation Center in the fiscal year of 2002. Up to now, Fuji Xerox DocuPrint C830 DP C830 has got Taiwan products have successively won that prize in Japan for many times. Eco-Label Award

1 In August 2005, Document Centre 900 and Document Centre 1100 were honored with China Environmental Labeling.

Document Centre 900 DC900/1100 acquired China Environmental Labeling Document Centre 1100

2 In February 2007, 21 digital multi-foundation devices successfully gained the China Certificate for Energy Conservation.

Document Centre 900 DocuCentre-Ⅱ C2200 DocuCentre650Ⅰ Document Centre 1100 ApeosPort-Ⅱ C2200 ApeosPort 650Ⅰ

3 The new series of products Wakasa (incl. DocuCentre-III C2200, DocuCentre-III C3300, ApeosPort-III C2200, ApeosPort- III C3300, and DocuPrinter C2250) which were put into production in October 2007 won the Japanese Minister of Economy and Industry Award in November in Japan. 4 In June 2008, a variety of digital multi-function devices and color laser printers our company produced were successfully honored with the China Certificate for Energy Conservation. 5 In February 2009, digital color multi-function devices (such as ApeosPort-IIIC4400CPS, ApeosPort-IIIC4400, DocuCentre- IIIC4400CPS and DocuCentre-IIIC4400) effortlessly won the China Certificate for Energy Conservation. 6 In March 2009, the digital multi-function fax equipment DocuPrint C1190FS readily acquired the China Certificate for Energy Conservation. 7 In December 2009, digital color multi-function devices covering DocuCentre-IIIC5500, DocuCentre-IIIC6500, ApeosPort- IIIC5500, ApeosPort-IIIC6500, DocuCentre-IIIC7600 and ApeosPort-IIIC7600 productively gained the China Certificate for Energy Conservation. 8 In March 2010, digital color multi-function devices, ApeosPort-IVC5570, DocuCentre-IVC5570, ApeosPort-IVC4470, DocuCentre-IVC4470, DocuCentre-IVC2270, DocuCentre-IVC3370, ApeosPort-IVC2270 and ApeosPort-IVC3370 successfully gained the China Certificate for Energy Conservation. 9 In May 2010, digital multi-function devices DocuCentre9000 effortlessly won the China Certificate for Energy Conservation.

All the above products have already gained China Compulsion Products Certificate (3C Certificate)

FuJi Xerox 27 Sustainability Report 2011 Solicitude for Employee's Efforts and Initiative Strengthening EAP (Employee Assistance Program)

EAP is Employee Assistance Program. It is a set of systematic and long-term program designed for employees. It aims to pay close attention to employees' development and solve varieties of employees' psychological and behavioral problems to make them happy at work, live a happy life and increase their sense of belonging via questionnaire survey, diagnosis and suggestion for the organization from professionals, professional instruction, training, consultation for employees and listening to employees' voices.

Work Focuses in 2010 Actual Achievements in 2010 Work Plans in 2011

●Continuing develop trainings of ●Implementing training according to plans ●Continuing the development training employees ●Response to all appeals of employees ●Listening to employees' voices ●Introducing new ways to conduct ●Listening to employees ●Concerned about employees' mental health psychological consultations ●Improving the system of mental health ●Strengthening the propaganda of EAP ●Distributing promotional materials in the company ●Expanding the contents of EAP

◆Training for Concerned about the Development of Employees In June 2010, Fuji Xerox of Shenzhen Ltd. learnt about the employees' demand and expectation of their own growth via routine EAP questionnaire survey once a year. And then the company made a training plan for “Concerned about the Development of Employees” of year 2010 and carried it out. The training aimed to explore employees' ideas, inspire them valuing their self-worth and make them experience the happiness of growing. The correlated curriculums included “Know yourself and challenge yourself”, “Your youth who call the shots”, “Speak & Eloquence”, “Interpersonal Relationship & Communication” and so on. Besides, special training courses were held for group leaders, such as “How to create an outstanding group”, “People management skills” and “How to be outstanding group leaders”, so as to guiding group leaders to lead their employees, improving the morale of employees, raising their efficiency and arousing their enthusiasm.

CSR Concerned about the Development of Employees & Mental Health Training Courses Table of Year 2010 Courses N.O.P. Training Satisfaction Ways to treat people 57 100% Love psychological coaching 31 100% How to make children love studying 83 100% How to create an outstanding group 68 100% Keeping in good health and health caring 106 100% Career planning 88 100% Job burnout 20 100% Friendship and love cannot be little. 22 100% Keeping in good health and health caring 2 72 95.6% Teach you how to be a deft financier 86 98.4% The role of group leaders in the production line organization 50 92.9% How to handle the conflict in management 44 94.7% Marriage management 61 100% Know yourself and challenge yourself 174 95.8% To be a positive person with mental health 210 97.6% My youth who calls the shots 61 94.5% Personality & Communication 23 100% People management skills 55 100% Emotional management 85 96% How to create an outstanding group 68 95% Management & Communication 68 95% Speak & Eloquence 305 95.7% How to cope with setbacks 180 100% How to cope with setbacks 284 94% Speak & Eloquence 185 98.5%

FuJi Xerox Sustainability Report 2011 28 Interacting with teachers Communicating with teachers during the break in the training scene

There were 2657 people who participated in the trainings for Concerned about the Development of Employees in 2010. In August 2010, 8 people were cited for “Learning Model” and one group was rewarded as “Learning Team” through the training summary of year 2009. And the Third Learning Models of FXSZ were honored and rewarded.

◆CSR Suggestion Box There were 7 CSR suggestion boxes set up at the entrance of canteen, dormitory and factory building so as to establish good communication channels between employees and company, enable the company to keep abreast of the voices of employees and improve the company's internal communication mechanisms and system. The CSR suggestion boxes were set up specially to accept the comments and suggestions of employees for company regulations, bonus-penalty, wage, welfare benefits, working environment, dining, accommodation and interpersonal relationship.

In 2010, the company received a total of 97 suggestions. The response rate reached 100%. For the reasonable suggestions, they got the settlements in time. Individual problems which took time to improve were advanced according to the plan. Besides, the suggestion and feedback were published in the homepage of CSR and on-Daily every month and shared with all people in the company.

◆Mental Health System Except for staff only counseling hotline and face-to-face counseling which were continuous opening, “Psychology open days” was introduced by Fuji Xerox of Shenzhen Ltd. since October 2010. In “Psychology open days”, workers could directly counsel with psychologist face to face in company, which not only lightened the travel burden and saved travel time of workers but also provided psychological counseling for workers conveniently.

Mental health lectures were held regularly in 2010, such as “How to cope with setbacks”,“Love psychological coaching” and “Psychological suggestion and self-confidence”, to fulfill the employees' needs and improve their psychological quality. In the meantime, the company held courses for the management level, such as “Keeping in good health and health caring”, “Marriage management”, “Management & Communication” and so on, to help them to promote the harmonious of their family, work and society. In December 2010, the company handed out a new Mental Health Guide to all employees and carried out an extensive study of mental health knowledge 您好,我是施乐员工, to continuously improve the knowledge of mental health of all employees and make 想预约 X 日 X 时的咨询 them pay more attention to their mental health.

Title Outline Achievement of year 2010 Participants:481 person-times; counseling hotline Total consultation time:425 hours Mental : ; health system face-to-face Participants 75 person-times Total consultation time :125 hours(An average (introduced in 2006) psychological counseling of 1.8 hours per time) Participants :1294 person-times; Mental health lectures Training satisfaction was more than 92%. 手 册 The company concerned about employees by a series of human-oriented activities such as promoting “Concerned about Employees' Development and Education”, setting up “CSR suggestion boxes” and introducing “counseling hotline, face-to-face counseling and mental health lectures”, since EAP was introduced 5 years ago. It not only provided platform for employees' self-growth and learning, but also help them de-stress, relax and make them work happily and live a happy life, which achieved a “win-win model” of company and employees so that all employees experienced the joy of growing up together with the company.

FuJi Xerox 29 Sustainability Report 2011 Training of Talented People

Fuji Xerox (Shenzhen) holds the view that talent is the key to the development of a business. Our company hopes to constantly enhance the vitality and promote company's sustainable development by strengthening the training of personnel and improving employees' overall quality.

In 2010, under the principle of “Safety, Quality, Cost, Shipment, Personnel”, adhering to the concept of “promoting cultural diversification's integration, happiness and growth”, keeping the mission of “encouraging self-development and experiencing the joy of growth”, our company continues to carry out a wide range of education and training and promote the development of personnel hardly.

It is our eternal pursuit to create a self-learning, positive, passionate and relaxed working environment. In order to achieve an effective company-wide sharing of educational resources, our company began to establish “Short Learn” at the end of 2009, and was accessed by company's internal network on April 12th. “Short Learn” integrates the present resources of company, and gathers company-wide professionals in various fields to re-edit and integrate the related knowledge system and collect the learning materials of all levels and functions from the point of view of the management and employees' growth. The first phase of settled layout includes “common knowledge”, “corporate culture”, “integrated management”, “ranking projects”, “function projects”, etc., it also covers Japanese Culture, Japanese Business Writing, Chinese-Japanese Translation, Business Etiquette, Problem Solving Techniques and Communication Skills. The employees of our company can select the content and time themselves according to their different objectives and needs to expand their learning environment and ability. “Short Learn” not only enhances the establishment of corporate culture, but also provides environment for “T”-type development of employees “ ” and guarantee for rational talents mobility system. The training of Problem Solving Techniques

Current management education will be comprehensively promoted in 2010. among the courses, New Manager Study was for the people of and above senior management before 2010. From 2010, the chairman extended learners to reserve managers from the consideration of company-wide talent construction, adequate reserve personnel, improving the compound management ability of reserve personnel and company-wide talent sustainability developed. There were more than 90 middle managers totally received different management trainings. It has laid the management foundation of eserve management by a series of courses, effectively strengthened the management level, and brought scientific way of thinking to workers of different levels to let them work with the common thinking on the same platform, which would greatly improve the efficiency of business.

New managers' study

FuJi Xerox Sustainability Report 2011 30 With the increase of production in 2010, a total of 5,500 new employees were employed in the full-year. Our company divided the inductive education into first, second and third education according to that these newcomers were just graduated from school and did not adapt to the new environment. Our company gradually and deeply conveyed corporate culture, codes of practice and job skills to new staffs and helped them change to workers from students by shortening and focusing the time on education as well as increasing the period.

In order to insure the “quantity” and “quality” of newcomers, the company began a deeper “school-enterprise cooperation” from 2010, signing contracts with many domestic vocational and technical schools for target training by establishing “Fuji Xerox (Shenzhen) Target Training Class” in schools. We brought newcomers' training courses to schools by the way of target training to insure to fulfill the needs of employing workers and also strengthen the effectiveness of training, so as to train a group of newcomers with “Quick Fighting Ability”.

As an international company with diverse culture, it attaches great importance to the GLOBAL ability of workers. For instance, the company develops the language ability, creates an environment and provides necessary resources for all workers to participate in Japanese and English study. There was a total of 150 people took part in language education, and it lasted for 6 months with remarkable results.

Japanese & Chinese speech

The company concerns the self-growth and development of employees rather than the development of enterprise. The company carries out a large-scale Chinese/Japanese speech every year to improve workers' ability to use language, fully show Xerox people's elegance and overall quality, promote corporate culture, enrich workers' spiritual life, promote mutual trust and understanding, promote the communication and integration of multi-culture, provide opportunities and stage of self-presentation and self-development for workers.

Looking back on 2010, we experienced serious challenges and made great achievements; outlook 2011, starting from a new point, we will always keep a keen attention to the internal and external environment, adhere the principle of “Go for the Next” from headquarter, consistently strive to create a good development environment for all workers, provide effective on-site management services, continue to strengthen and improve the company's talent training system to attract and retain talent with different cultural backgrounds for the company.

FuJi Xerox 31 Sustainability Report 2011 Logistic Service for Employees

1. Employees' Living Conditions and Welfare Improving 1) Accommodation People-oriented is the eternal business principle. Our people are our asset. Employees will work hard and create wealth for the company only if the company cares about them sincerely and guarantees their benefits sufficiently. In order to provide employees clean, comfortable and safe living conditions, the company carried out activities to improve accommodations' facilities and embellished environment in 2010, including renovating toilets in bathroom, installing coin washing machines, hair dryers and replacing curtains and blinds on each floor of the dormitories and changing shower curtains in bathroom, as shown in photos.

2) Environment Greening In the latter of 2010, for saving the cost of environment greening, the company and cleaning department picked up plants and flowers which were at the road construction site outside of the factory gate and replanted them. Besides, they planted grass, trees and bushes in the damaged green belt around the canteen, accommodation and the parking lot, as shown in the photos.

2. Council Activated Activities The company provides about 3800 employees with accommodations. During the May Day and Spring Festival holiday, the Council will develop a series of activated activities to fully embody the entertainment welfare granted by the company during the consecutive holidays. The activities include: tug-of-war, tennis, casting tennis between peoples, table tennis, kicking shuttlecock, clipping marbles and so on.

3. Large-scale Events of Company 1) The Mountaineering Festival of Year 2010 On 25th December 2010 (Christmas Day), with “Building Body, Promoting Harmony” as its slogan, the Fourth Mountaineering Festival at Bijiashan was hosted successfully. Mountaineering which started with the president of Okaji Toshihiko to launch the starting pistol is the major competition in this activity. The competition set up totally six groups with 15 members in each, namely red, blue, black, yellow, orange and white, and placed six rewards including the champion for one group, silver medal winners for two groups and the second runner-up for three groups. And corporate leaders presented the delicate prizes. Besides, the other major activity is games. Single player games and group games are included. The bureau provided delicate small prizes for each game, which won the enthusiasm participation of most employees.

2) The 9th Company Improvement Convention Company-wide activities of improvements in all aspects were actively launched in 2010. To provide a showing platform, offer opportunities to learn from each other for these excellent improvements, improve the ability of improvement and inspire the improvement affection, the company successfully held the 9th Company Improvement Convention in local culture & sports center on 31st March 2011. There were 12 topics (including one topic from suppliers group) in the activity and 600 people presented.

FuJi Xerox Sustainability Report 2011 32 Grow Up With the Local Region —Dedicating Charity, Servicing Community and Promulgating Civilization Fuji Xerox of Shenzhen Ltd. is dedicated to contributing to society and promoting the development of socialist culture. Our company tries to affect more corporations to concern environmental protection, education, vulnerable groups and other social public interest activities by its own efforts. With all efforts done, Fuji Xerox hopes to create a favorable atmosphere, so as to achieve the sustainable development of society.

In September of 2007, Fuji Xerox of Shenzhen Ltd. helped to build the first “Fuji Xerox Environmental Protection Hope Primary School” in Jingoutun Town, Luanping County, Hebe Province with the strong support of government organizations, such as State Environmental Protection Department, China Environment News, etc. Later in September of 2008, our company helped to build the second “Fuji Xerox Environmental Protection Hope Primary School” in Daqiao District, Huize County, Yunnan Province. Besides the environmental protection hope primary school, our company also helped to build “Fuji Xerox Hope Primary School” in Dunhuang City, Gansu Province in Northwest China. These primary schools were village schools in National Poor Regions originally, the houses got old and shabby and hardware condition was poor. With the assistant of Fuji Xerox of Shenzhen Ltd., the schools got improved and new classrooms, libraries, computer labs were built, especially special teaching area were established, such as Environmental Protection Handmade Products Showroom, Red Scarf Climate Monitoring Station. All of these made great improvement to infrastructural facilities as well as enriched students' extracurricular activities.

The computer lab of Hope Primary School Taking a photo with the delegation of Hope Primary School

In 2010, the senior management and representatives of our company visited the primary schools, continued to provide consolation money for the three primary schools, donated computers and books and purchased teaching equipment and environmental protection facilities. During the visit, people found the schools took on a new look every year. Our company hopes to strengthen environmental education and improve teaching quality by providing support and help for the education of young people. Our company also hopes to cultivate good habits of caring about the environment, loving the environment and protecting the environment when they are young, develop the thought of sustainable development and make the spirit and idea of environmental protection be rotted in their minds through publicity, education and practice on the campus.

Students are having Chinese class Visiting the needy students

FuJi Xerox 33 Sustainability Report 2011 To enlarge the voluntary force of company and employees further, Fuji Xerox of Shenzhen Ltd. conducted Fuji Xerox (Shenzhen) Volunteer League from the ratification of Shenzhen Volunteer Association on 31st December 2005. Fuji Xerox Volunteer League has already walked five years, and has developed to 650 members from 57 at the initial stage.

Offering consolation to Children's Welfare Home On June 5th of 2010, about 21 volunteers came to Shenzhen Children's Welfare Home with gifts for children. Besides the deserted children, there were many children with intelligence, hearing, and physical defects. The volunteers sang and danced with children, and expressed their love for children with warm smiles.

Children's lovely face Taking a photo with the children of welfare home

Cleaning the beach, team building On August 14th, 74 representatives of our company came to Kuichong Beach located in east Shenzhen picking up litter and cleaning the beach. They also carried out the team building activity with all members in to increase the cohesion of the team, and held annual evening party to commend company's outstanding volunteers. The volunteers were picking litter on the beach

Help to hold Hi-tech Fair (Hi-tech Fair: China Hi-tech Fair) On November 21st, in answer to the call of Shenzhen Volunteer Association, our company organized 36 volunteers to maintain external traffic order of the twelfth Hi-tech Fair in Shenzhen Convention & Exhibition Center, and made our own contribution for the success of the fair receiving high commend from the host and Shenzhen Volunteer Association. Taking a photo in front of Hi-tech Fair venue

Little love, warm support On March 21st, volunteer league organized a collection in front of company cafeteria for giving their love to people who were suffered in the earthquake in northeast and tsunami happened in March 11th in Japan and helping our neighbor to rebuild their homes. Endowments was sent to Japanese Red Cross by the Japanese Consulate General in Guangzhou, and the special funds was used for earthquake relief and reconstruction.

FuJi Xerox Sustainability Report 2011 34 Social Awards

1995 ■ Honored as “Credit Enterprise”by Shenzhen Customs District

1996 ■ Awarded“Foreign-Invested High-Tech Enterprise in Shenzhen” by Shenzhen Economic Development Bureau

1997 ■ Appraised as“Abiding by Strictly Contract and Being Trust Worthy” Enterprise by Shenzhen Industrial and Commercial Bureau

■ President Yotaro Kobayashi of the Head Office was awarded the title of “Honorable Citizen of Shenzhen” by Shenzhen Government 1998 ■ Obtained the honor of “National Export Foreign Funded Advanced Enterprise”by China Ministry of Foreign Trade and Economic Cooperation ■ Acquired ISO9002 Certification

■ Won the title of “Shenzhen Advanced Enterprise in Processing and Export Trade of Year 1998” 1999 ■ Won the title of “Shenzhen Advanced Enterprise in Security Management of Year 1997 to 1998”

■ Graded as “Shenzhen Top 100 Industrial Enterprise” 2000 ■ Graded as “Shenzhen High-Tech Industry” by Shenzhen Bureau of Science and Technology ■ Acquired ISO14001 Certification

■ Appraised as a enterprise with “Three Swiftness and Three Excellent Qualities ” by Buji Custom in Shenzhen 2001 ■ Recognized as “Home of the Migrant Workers” by Shenzhen Government ■ Graded as “Export Advanced Enterprise” by Bureau Foreign Trade and Economic Cooperation of Shenzhen Municipality ■ Graded as “Advanced Enterprise for Exporting High-Tech Products Over 100 million USD” by Guangdong Bureau of Foreign 2002 Trade and Economic Cooperation ■ Graded as “Top 22 National Foreign-Invested Enterprise” by China Association of Enterprises with Foreign Investment ■ Won the title of “Top 100 Largest Exporting Enterprise in Processing Trade of Year 2002 ” and “Shenzhen Top 100 Industrial 2003 Commerce of Year 2002” ■ Won the title of “National Double-Excellence Foreign-Invested Enterprise of Year 2002” ■ Gained the title of“Shenzhen Top 100 Industrial Enterprise of Year 2003” and “Top 100 Exportation Enterprise” 2004 ■ Acquired OHSAS18001 Certification

■ Won the title of “Top 100 Industrial Enterprises of Year 2004” 2005 ■ The President Inagaki Masaaki gained the award of “Friendly Foreign Expert”. ■ Recognized as “National Environment-friendly Enterprise” by Ministry of National Environmental Protection, PRC

■ Ranked 14th of 'Shenzhen Top 100 Industrial Enterprise in 2005' ■ Regarded as “Top 10 Enterprise in Developing Recycling Economy” in the first session ■ Awarded as “Top 500 Chinese Manufacturing Enterprises of Year 2006” 2006 ■ Awarded with “National Double-Excellence Foreign-Invested Enterprise of Year 2006” ■ The President Inagaki Masaaki was honoured with “Shenzhen Outstanding Foreign Entrepreneur of Year 2006” ■ Ranked the First of Guangdong Largest Exportation Enterprise in 2006 ■ Honored with the title of 'the State First-Grade Safety and Quality Standardization in Machine Manufacture Enterprise'

■ Ranked 15th of “Shenzhen Top 100 Industrial Enterprise in 2006” 2007 ■ Won the title of “Chinese Excellent Enterprise Citizen” in its third session ■ Appraised as “Shenzhen Top 10 Corporation of Ecological Constriction”

■ Ranked 14th of“Shenzhen Top 100 Industrial Enterprise in 2007” 2008 ■ The President Inagaki Masaaki was honored with “Excellent Entrepreneur for the 30th Anniversary of Reform and Opening-up of Bao'an District” ■ Ranked 14th of “'Shenzhen Top 100 Industrial Enterprise in 2008”' ■ Ranked the First of Guangdong Largest Exportation Enterprise in 2008 ■ Awarded with “National Double-Excellence Foreign-Invested Enterprise of Year 2008” ■ Honored with “Pengcheng Advanced Enterprise in Waste Reduction” issued by Pengcheng Waste Reduction Group in Shenzhen 2009 ■ Won the Golden Honeybee Ethical Procurement Prize issued by WTO Guide ■ Enrolled in “Top 50 National Green Corporation” ■ Enrolled in “Top 100 Largest Enterprise of Year 2008 in Guangdong” and “Top 100 Largest Industrial Enterprise of Year 2008 in Guangdong” ■ Regarded as Shenzhen Energy Conservation Model Enterprises ■ Gain the plaque of “Enterprise with tax payment over 10 million Yuan” by Nantou Customs

■ Ranked 16th of “Shenzhen Top 100 Industrial Enterprises in 2009” ■ Won the title of “Outstanding Contribution Enterprise of Shenzhen Special Economic Region for 30 Years” 2010 ■ Director Yamamoto was elected as “Multinational Leader Affected Shenzhen Special Economic Region for 30 Years” ■ Awarded as “China Outstanding Corporate Citizen of Year 2010”

th 2011 ■ Ranked 18 of “Shenzhen Top 100 Industrial Enterprises in 2010”

FuJi Xerox 35 Sustainability Report 2011 Social Contribution

1997 ■ Sponsored a scholarship in Northern Jiaotong University

■ Donated for victims of the earthquake happened in Zhangjiakou City, Hebe Province ■ Sponsored a scholarship in Xi'an Jiaotong University 1998 ■ Established a supportive fund for Kindergarten of Guanlan Town ■ Donated for victims of flood calamity in the Yangzi Valley

2002 ■ Sponsored a scholarship in Harbin Institute of Technology

2003 ■ Sponsored a scholarship in Xinzhou Technology College in Wuhan

■ Sponsored a scholarship in Guangdong University of Foreign Studies 2004 ■ Donated for victims of the earthquake happened in Niigata, Japan

2005 ■ Helped to build 'Fuji Xerox Hope Primary School' in Qili Town, Dunhuang City

■ Sponsored China Environment News to hold the First National Composition Competition on environmental protection for 2006 elementary and secondary Students ■ Donated for victims of the flood happened in Guangdong Province ■ Sponsored China Environment News to hold the Second National Composition Competition on environmental protection for 2007 elementary and secondary Students ■ Helped to build 'Fuji Xerox Environmental Protection Hope Primary School' in Luanping County, Hebe Province ■ Donated for victims of the earthquake happened in Wenchuan, Sichuan Province ■ Sponsored China Environment News to hold the Third National Composition Competition on environmental protection for 2008 elementary and secondary Students ■ Helped to build 'Fuji Xerox Environmental Protection Hope Primary School' in Daqiao District, Huize County, Yunnan Province ■ Sponsored educational facilities and books to 'Fuji Xerox Hope Primary School' in Dunhuang City, Gansu Province ■ Sponsored educational facilities and books to 'Fuji Xerox Environmental Protection Hope Primary School' in Luanping County, Hebe Province 2009 ■ Sponsored educational facilities and books to 'Fuji Xerox Environmental Protection Hope Primary School' in Daqiao District, Huize County, Yunnan Province ■ Condoled with Huayang Exceptional Children Rehabilitation Centre in Shenzhen

■ Donated for victims of the earthquake happened in Yushu, Qinghai Province ■ Sponsored for the Drama Competition of Guangdong University of Foreign Studies ■ Sponsored educational facilities and books to 'Fuji Xerox Hope Primary School' in Dunhuang City, Gansu Province ■ Sponsored educational facilities and books to 'Fuji Xerox Environmental Protection Hope Primary School' in Luanping County, Hebe Province 2010 ■ Sponsored educational facilities and books to 'Fuji Xerox Environmental Protection Hope Primary School' in Daqiao District, Huize County, Yunnan Province ■ handed out 2010 Fuji Xerox Scholarship in Harbin Institute of Technology ■ handed out 2010 Fuji Xerox Scholarship in Xi'an Jiaotong University ■ handed out 2010 Fuji Xerox Scholarship in Northern Jiaotong University

FuJi Xerox Sustainability Report 2011 36 The Third Party Comments

Many accidents have happened, for example, strike happened in Honda Company, more than ten suicide events occurred in Foxconn, migrant workers riots took place in Chao'an, Chaozhou and Zengcheng, Guangzhou in June of 2011. All of these accidents issued a message to the whole world: the new generation of Chinese workers could not bear the bad working condition and unrespectable labor any more. The cheap labor which was ever proud by China may no longer exist in the near future, and export-oriented development strategy of China based on cheap labor faces strong challenge from laborers. Moreover, export process industry taking migrant workers as the key component may be abandoned by workers, if the labor relations cannot be timely adjusted and communication system between the management and workers will not be optimized.

The challenge from the new generation of workers offers a unique opportunity for the industry and government, namely to change the modes of economy development from “downward competition” to upward promotion through corporate social responsibility. Of course, it raises many controversial topics. For instance, how does the corporate social responsibility to play an important and effective role in the long-term of enterprises? What role will employees play in implementing corporate social responsibility? Whether empowerment to workers will bring further economic interests? How big is the gap between the corporate social responsibility and the practice and how to eliminate the gap?

From the Sustainable Development Report (2011) of Fuji Xerox (Shenzhen), I saw an effective solution to these problems. It is to regard the environmental protection and employees' growth as company's primary business interests, and to make the basic principle of harmonious labor relations, ecological security, and healthy environment permeate corporate business activities.

Therefore, in this report, we can not only see the effective implementation of the environmental protection strategy, but also see the reduced work-related injury accidents since 2002 and employees' awareness of occupational safety and health. Moreover, we can see employees' growth and joy. I am glad to see Fuji Xerox expands the commitment and practice of corporate social responsibility to the end of supply chain, so that the process of forming the entire value chain of “Xerox” brand will have a common responsibility and values. I particularly appreciate the partnership of “learn together, grow together and become strong together” between Fuji Xerox and its suppliers, because the business relationship based on trust and responsibility is not only the core values of corporate social responsibility, but also the core of the social sustainable development. This value and belief can overcome the common problems faced by the current China and even the global supply chain, and will eliminate the conflicts and contradictions among corporate, environmental protection and employee benefits.

The Institute of Contemporary Observation (ICO) is a nongovernment nonprofit organization dedicated to labor rights development and corporate social responsibility. From 2006, ICO has carried out Employee Growth and Education Project in Fuji Xerox for six years, witnessed Fuji Xerox of Shenzhen Ltd. based on empowerment to workers to put the value of corporate social responsibility into various enterprise internal details, making it be a basic way of life for Fuji Xerox of Shenzhen Ltd. in addition, the Fuji Xerox employees' feedback and social feedback is amazing: the product quantity and quality of the company have got significant improved, the staff turnover rate was remained in reasonable low level, employees' satisfaction for company got continuous improved. It is a sustainable development of win-win between the enterprise and employees.

July 2011

FuJi Xerox 37 Sustainability Report 2011 Investigation on Sustainable Development Report 2011

Thank you for reading our Sustainable Development Report 2011. The report intends to provide correct and objective information about the persistent effort we have made for social sustainable development which will strengthen mutual understanding between the operation and its stakeholders. For better communication, please take a moment of time to give your valuable comments and suggestions about our report. The Sustainability Report is accessed on www.fxsz.com.cn.

Please return the questionnaire to CSR Department Fuji Xerox of Shenzhen Ltd. Tel: (86) 755-27981111-406 Please Fax: (86) 755-27981535 cut E-mail: [email protected] along the dotted line

FuJi Xerox Sustainability Report 2011 38 Questionnaire

1.Is this report easy to read?

□ A. Strong Agree □ B. Agree □ C. Acceptable □ D. Disagree

2.What do you think of the CSR performance carried out by Fuji Xerox Co., Ltd (Shenzhen)?

□ A. Strong Agree □ B. Acceptable □ C. Unacceptable □ D. Strong Disagree

3.Please outline three topics attract you mostly, such as Highlight, Green Production, The Effort and Improvement on Employee Concern, etc., and write down your reasons.

A: Why?

B:

Why? C:

Why?

4.Is the information addressed in this report useful to you?

□ A. Strong Agree □ B. Agree □ C. Acceptable □ D. Disagree

5.If you have other comments or suggestions, please give a brief description.

6.What is your position reading this report?

□ Customer for Fuji Xerox Products □ Associated Government Official □ Environmental Expert □ Associated Corporation □ Student □ Residents in the neighborhood □ Employee in Fuji Xerox of Shenzhen Ltd. □ Journalist □ Procurement Agent/ Officer of Procurement Department □ Partner of Fuji Xerox □ Officer of Corporate Environmental Management □ Other

Name

Occupation

Contact

FuJi Xerox 39 Sustainability Report 2011 GRI Guideline Index

Published Pages General Outline GRI Standard

1 Editorial Policy Parameter

2 Table of Contents Parameter

3 CSR Philosophy of Fuji Xerox and Corporate Vision in Fuji Xerox Corporation Strategy 5 Message from the President Corporation Strategy 6 Corporate Profile and Annual Financial Information Corporation Profile Social/Environmental 8 "Focus Report": Introduction and Table of Contents Protection Achievement Build Harmonious Labor Relations

9 —Carrying Out Cultivation Movement

10 —Multifarious Activities of Manufacturing Department Labour Relations

13 —Trade Union Activities

The Promotion of Environmental Management

15 —Basic Environmental Management Strategy and Tactic Corporate Strategy

16 —Objectives and Achievement of Environmental Management Environmental Protection 17 —Sustainable Management System of Environmental Management Achievement 17 —Initiate Environmental Protection Activities Safety Management

19 —Policy, Objective and Achievement of Safety Management

20 —Sustainable Management of Occupational Safety system Safety & Health /Education

21 —Safety and Health Education and Propaganda

Co-operational Promotion with Suppliers

22 —Continuous Advance to CSR Procurement Stakeholder Participation

Legal Compliance, Sincerity and Reliability 24 —Continuous Advance to Internal Control System Human Right/Products Liability Green Production

26 —Restriction of Hazardous Substances Environmental Achievement/ Product Liability 27 —Energy-Saving Product Certification Working on Improvement of Staff Caring 28 —Strengthening EAP (Employee Assistance Program) Labor Relations/Health/Training Education & Training/ 30 —Training of Talented People Diversification 32 —Logistic Service for Employees Labor Welfare Grow up with Local Region Environment/Community/ 33 —Dedicating Charity, Serving Society and Promulgating Civilization Human Right 35 Social Awards and Contribution Organization Profile 37 The Third party Comments Commitment

FuJi Xerox Sustainability Report 2011 40 Fuji Xerox of Shenzhen Ltd.