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    2018 Environmental, Health & Safety Annual Report 2018 FASTENAL COMPANY | 2001 THUERER BLVD, WINONA, MN 55987


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    Fastenal Company Environmental, Health & Safety Policy Fastenal Company is committed to environmental protection and to providing a safe and healthy workplace for all employees. We strive to integrate EHS considerations into all our business decisions, plans, and operations. As part of our commitment to the protection of the environment, we shall strive to prevent pollution, to reduce waste and minimize the consumption of resources, to use resources responsibility and to seek opportunities for increased energy efficiency. As part of our commitment to ensuring a safe and healthy workplace, we strive to prevent work-related injuries and ill health by controlling risks using a hierarchy of controls. In order to enhance our EHS performance, Fastenal Company shall identify EHS objectives to be attained in order to continually improve our EHS Management System. Fastenal Company is committed to the fulfillment of all EHS compliance obligations, including all legal and other requirements. We believe that participation and involvement from employees and other interested parties in EHS Management System decision-making processes will help us to achieve our intended outcomes. An important objective of EHS Management System is the satisfaction of our stakeholders, which include:  Our customers,  Our employees,  Our shareholders,  Our suppliers,  The communities in which we operate, and  The environment. This policy shall be communicated to all employees, and will be made available to our customers and other interested parties upon request. January 1, 2019 1 FASTENAL COMPANY | 2001 THUERER BLVD, WINONA, MN 55987


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    Health & Safety Programs With over 20,000 employees, Fastenal Company continues to make strides in our Environmental, Health, Safety & Security initiatives. As we focus on our programs, we continue to see changes in employee beliefs, attitudes, and results. A number of key areas continue to spearhead these initiatives and prove to be strong indicators of our success. Fastenal employees continue to have a high degree of participation in a variety of programs. With over 142,000 events measured in our business, we strive to improve the quality of engagement our employees experience with environmental, safety, security topics. Training participation grew to over 96,350 completed modules. These trainings include over 30 topics ranging from safe behaviors to compliance topics. This strong dedication and focus is a great reflection of our employee attitudes towards safety participation. In 2018, the Fastenal EHS department made a number of updates to their training modules to help drive “quality” of participation. “Thank you for continuing to care for this Blue team and treating the employees at Fastenal like family. Your care is what drives us to continue to do our best for the company.” – Branch TX098 2 FASTENAL COMPANY | 2001 THUERER BLVD, WINONA, MN 55987


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    Fastenal employees completed over 33,500 audits and inspections in 2018. This is a key area for continuous improvement, which helps Identify areas of opportunity to improve. EHS managers consistently visit branch locations to support a variety of initiatives and reduce hazards that may develop. Fastenal management also participate in a variety of site visits related to safety operations and driving safe behaviors. This participation is key to supporting a safe culture. One on one coaching by our management and leadership continues to be a core focus to help reinforce safe behaviors and accountability. In addition, this participation creates stronger relationships and an overall healthier business between management and front line employees. This ability to influence our employees across the company provides a strong platform for reducing losses throughout the company. Fastenal management completed over 12,000 coaching and observation opportunities. At a high level, these leading indicators appear straightforward but provide a complex road map to continuous improvement to engaging employee behaviors and driving incident prevention. These focuses combined with our audit, compliance programs help continuously drive support, and engagement at all levels of business. We saw a slight increase in our TRIR in 2018 versus 2017 however, continue to sustain a low rate compared to the industry average. Fastenal Company’s EMR rate sustained at .48 which outperforms our peer group by nearly 52%. We continue to focus on high risk key areas to help reduce severe incidents in our business. The efforts of managers and employees at the line level have been a significant driver to reducing high cost incidents. 3 FASTENAL COMPANY | 2001 THUERER BLVD, WINONA, MN 55987


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    Thru strong case management programs and a focus on preventing severe incidents we’ve reduced our days away from work and the amount of time employees are on restrictions. In 2018 alone we added over 59,000 labor hours versus 2010. Overall, Fastenal has been able to add nearly 350,000 hours of productivity since 2010. In addition, Fastenal has prevented more than 2,400 workplace injuries over that same time. These prevention efforts help to improve moral, bring teams closer together, and provide more opportunities for sales and efficiencies. Most importantly by helping our employees be safe at work it reduces the burden on other employees when an employee would be missing days of work as the result of an injury. At Fastenal, safety truly is a team effort. “Thank you for providing the tools for a safe and productive work environment. James “Ryan” Tucker We love working @ Fastenal!” – Branch Corporate EHS Manager WYDOU ISO 14001 (Environmental Management System) & 45001 (Occupational Health and Safety Management System) In 2018, Fastenal implemented two new ISO Management Systems: ISO 14001 (Environment) and ISO 45001 (Safety) in an effort toward continuous improvement in each of these disciplines. As an early adopter of the ISO 45001 draft standards, we were able to self-certify in 2018 to the final released standards immediately, being the first company to adopt the new international standards. Last year our multiple day extensive audits that assess our management system covered 10 sections of the standard along with hundreds of questions and interviews. We take pride in driving progressive safety programs throughout our business. These programs will assist the company in meeting the expectations of our customers and our other stakeholders. With an all-encompassing ISO program we have been able to include many existing practices our company values. This formal system has allowed Fastenal to improve and focus on areas in an organized manner which helps produce better results. These management systems have allowed employees to provide feedback and participate in areas that may not have been a core focus for our business. Finally, we strive each year towards these defined goals to drive value for all stakeholders of our business Randy Parnow Corporate EHS Manager “Thank you for keeping our teams safe and ensuring everyone goas home at the end of every day.” – Branch CAVIC 4 FASTENAL COMPANY | 2001 THUERER BLVD, WINONA, MN 55987


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    Environmental Programs With over 2,600 branch, distribution centers and manufacturing locations, Fastenal’s presence is felt in many communities. Ensuring and protecting the environment within those communities is foremost in our thoughts. In combination with our ISO 14001 and third party auditors, Fastenal uses recycling programs, effective waste disposal programs and extensive on-going employee training to help communities rest easy. Fastenal is also committed to a number of objectives when it comes to environmental stewardship. These include targets such as sustaining zero compliance related fines, improvement in environmental risk assessment audits, base line reductions in areas of hazardous waste disposal, and improving fleet fuel efficiencies, as well as improvements in recycling initiatives. The secret to ensuring that these environmental objectives are met with customers and communities lies within the ranks of Fastenal employees themselves. When an employee joins Fastenal, they are subjected to extensive training from the time the New Employee Orientation Program (NEOP) starts, until their tenure ends. This includes initial NEOP training related to handling and shipping of hazardous material, the proper way to dispose of hazardous material, and also includes ongoing departmental and EHS training concerning what actions are appropriate in various environmental scenarios. In order for Fastenal to remain proactive and protect the communities and customers that it serves, it is imperative that employees are aware of the environment in which they work and the situations which they may encounter. Because we understand the importance, our business has on sustaining a healthy community we offer training and encourage participation in various environmental topics. In 2018, over 6,000 employees participated in our Resource Conservation and Recovery Act training. Even though this is not required due to our limited waste generating activities, we strive to ensure our communities thrive for years to come. Byron Livingston Regional EHS Manager “We really appreciate the push to keep us all safe and compliant. IT really shows the value that is placed on the team.” – Branch CO006 5 FASTENAL COMPANY | 2001 THUERER BLVD, WINONA, MN 55987


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    Summary In recognition of our top performers this year in environmental, health and safety we wanted to extend congratulations to those areas that excelled in one of three different areas. Perfect Record Awards indicate locations that did not experience a recordable injury for the entire calendar year. Occupational Excellence Achievement Awards go to performance that is 50% better than the industry average and finally, Significant improvement awards are those areas that reduced their severe injuries by over 20%. Fastenal employees have achieved a great deal when it comes to environmental, health and safety intiatives. We thank our employees for taking such great pride in living our company values and driving improvements and efficiencies to help reduce incidents and better our business. We hope these improvements not only improve our business but bring value to the families, communities and customers we serve. In 2018, in an effort for continuous improvement we asked for feedback by our employees in the field. We were overwhelmed with responses to the tune of over 1,200 branches providing great feedback to help us sustain or improve our programs. I believe this speaks to the culture of our business and our employees attitudes towards environmental and safety programs. Dave Olson Environmental, Health & Safety Director “Thanks for all the efforts performed in order to accomplish the safety standards for our branches, it demonstrates our company worries about the employees and our lifes in general!” – Branch MRCUA 6 FASTENAL COMPANY | 2001 THUERER BLVD, WINONA, MN 55987


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    FASTENAL COMPANY | 2001 THUERER BLVD, WINONA, MN 55987 7 FASTENAL COMPANY | 2001 THUERER BLVD, WINONA, MN 55987


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