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Procurement Initiatives

Basic Approach

We strive to ensure compliance with the laws, regulations, and social norms of Japan and the other countries and regions in which we operate. We also require our business partners to observe these standards of fulfilling their social responsibilities given the changing social expectations placed on companies. In principle, we conclude a basic contract with each business partner from which we purchase items such as equipment or raw materials, requiring the contracting parties to fulfill their corporate social responsibilities (CSR). Our criteria for selecting business partners include their CSR and environmental impact reduction initiatives.

The Global Procurement Division is in overall charge of the purchasing of raw materials, fuel, and equipment for use at our Company’s plants and our Group companies worldwide. Our procurement policy and Green Procurement Guidelines are posted on the Company’s website. The procurement policy is now published in Japanese, English, and Chinese. Given the standards of the Responsible Business Alliance (RBA)*1 Code of Conduct (formerly the EICC Code of Conduct) and changing frameworks for general business dealings, we are working to observe this policy in our procurement activities, and we require our business partners to do the same, too.

●Our Group’s Supply Chain

Our Group's Supply Chain

CSR supplier surveys and carbon neutrality promotion

To ensure ongoing measures for responsible procurement of minerals, we have also identified applicable raw materials and started conducting surveys in fiscal 2022. We verified the raw materials we purchase that contain tin, tantalum, tungsten, gold, cobalt, and mica with 40 materials identified as applicable throughout our entire Group. We will continue conducting surveys of our suppliers using the minerals survey template.

We are continuing to work toward achieving carbon neutrality, and have ensured the supply of green power to business sites in Japan for 2023, and finalized contracts. We have also coordinated efforts with the relevant departments and have completed installation or are in the process of installing solar power generation equipment at main business sites in Japan, and we are also progressing with installation at business sites overseas. The amount of solar power generated increased 3.4-fold and 15.6-fold for Japan and overseas, respectively, compared to fiscal 2021 levels.

We have also started inspecting raw materials affected by carbon neutrality and evaluating substitute materials. Procurement of green chemicals involves securing a source of bio-PE, ensuring a supply volume of lignin and furfuryl alcohol, and examining bio-based phenol and bio-based methanol markets.

Selection of Business Partners

When selecting new business partners, the decision to commence transactions is made based on fair and impartial judgment after applying the criteria established by the Global Procurement Division. When commencing transactions, we check whether the Act against Delay in Payment of Subcontract Proceeds, etc. to Subcontractors applies, and if it does, we commence the transaction in accordance with this law and the relevant company rules. If we find that this law applies to existing transactions, we immediately take measures to ensure the legality of these transactions under this law.

We have established company rules requiring that we check whether new raw materials comply with chemical substance controls both domestically and internationally, and new raw materials are not adopted unless they conform to these controls. Relevant departments internally work closely together to investigate and make sure that the Company does not violate chemical substance controls.

We are convinced that it is important to establish a relationship of equals based on trust with every business partner and that the transactions should be beneficial to both parties.

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