Relevant SDGs
Because our Group engages in a variety of business activities, we must interact with an assortment of different partners, including suppliers. We aim to establish long-term, mutually beneficial relationships with our suppliers and engage in sustainable procurement practices. What follows is a brief overview of what we are doing in this regard.
Procurement Policy
Our Group believes that by working with our suppliers to address sustainability challenges throughout the entire supply chain, we can build long-term trust with local communities and contribute to the creation of a sustainable society. In November 2022, we revised our Group Procurement Policy and established the Seiko Group Procurement Guidelines as a supplementary document to help both our employees and our suppliers carry out sustainable procurement activities.
Seiko Group Procurement Policy
The Seiko Group will fulfill its social responsibilities by contributing to the realization of a sustainable society through the implementation of our corporate philosophy – creating “A future filled with smiles all over the world” and of being “A company that is trusted by society.” To this end, the Group has established three key aims for its procurement policy: 1) Coexistence and co-prosperity with business partners; 2) Promoting procurement activities with proper consideration for the environment, society, and corporate governance; and 3) Fair and impartial selection of business partners.
The Group will expand its procurement activities globally based on these three policy aims, which are described in greater detail below.
1.Coexistence and co-prosperity with business partners
The Seiko Group and its business partners aim to build a relationship of mutual trust over the long term. It is our goal to continue to prosper together by helping each other.
2.Promoting procurement activities with proper consideration for the environment, society, and corporate governance
We will respect global social norms and work together with our business partners to promote responsible procurement activities that involve proper consideration for the environment, society, and corporate governance.
We will promote procurement activities that take into consideration the following factors (among others):
- Compliance with laws, regulations, and social norms
- Respect for human rights
- Protection of occupational safety and health
- Promotion of global environmental conservation
- Promotion of business continuity planning (BCP)
- Prohibition of bribes (including illegal gifts, payments, and benefits) to any stakeholder
3.Fair and impartial evaluation of business partners
We respect “fair, transparent, and free competition,” which is a fundamental rule of a freely competitive society, and we evaluate our business partners based on the following criteria:
- The partner must be active in environmental, social, and corporate governance initiatives
- The partner must be highly trusted as a company (Stable business conditions, appropriate risk management system, etc.)
- The partner must have technological capabilities that can contribute to Seiko Group products
- The quality, price, and delivery times of the items procured must be at appropriate levels.
We will conduct comprehensive evaluations based on these and other criteria.
We aim to improve the value of our entire supply chain by conducting business in accordance with this Seiko Group Procurement Policy.
Seiko Group Procurement Guidelines
We formulated the Seiko Group Procurement Guidelines and the accompanying Explanation of the Guidelines as references for the entire supply chain. These documents take into account our business environment and material issues while aligning with the Responsible Business Alliance (RBA) Code of Conduct (ver 7.0) and other criteria.
Sustainability Promotion Structure and System
To further promote supplier engagement, a Responsible Procurement Liaison Meeting was established under the Sustainability Committee in fiscal year 2023.
Initiatives
Until recently, Seiko Instruments was the Group company most actively engaged in responsible procurement initiatives, including the establishment and operation of supplier certification systems and green procurement standards at each business unit. However, beginning in fiscal year 2023, we launched a comprehensive Group-wide approach to supply chain management.
In the first half of 2023, operational rules for the guidelines were formulated by the Responsible Procurement Liaison Committee. In the second half of the term, we are working to identify suppliers who are at high risk for human rights problems, conducting supplier briefings, obtaining signed agreements to implement changes, and advancing the Self-Assessment Questionnaire (SAQ) survey. The Group recognizes the risk of contributing to human rights violations through procurement as a significant human rights risk. The establishment of a supplier management system based on appropriate guidelines helps to address this risk. In the future, if human rights-related issues arise from procurement activities, we will work together with suppliers to implement corrective measures, focusing on preventing and mitigating negative impacts on human rights as well as on the environment.
We will continue to actively practice sustainable procurement, collaborating with suppliers to address sustainability challenges.
Initiatives Pertaining to Conflict Minerals
We are keenly aware that minerals mined in conflict regions around the world have served as a source of funding for local armed groups. These groups are known to engage in inhumane activities, including forced labor and forced child labor. Companies worldwide are now required to scrutinize their supply chains to avoid contributing to human rights abuses through their business activities, and to mitigate associated risks.
Within our Group, some business units have already established Conflict Mineral Response Policies to ensure that minerals used in their operations do not contribute to human rights violations. However, starting from fiscal year 2023, we began taking a Group-wide approach, and in November of 2023, we formulated the Seiko Group Responsible Mineral Procurement Policy. Going forward, we will identify, assess, and address risks in line with this policy.
Seiko Group Responsible Mineral Procurement Policy
Mineral resources (such as tin, tantalum, tungsten, gold, etc.) mined in conflict-affected and high-risk areas (CAHRAs) carry inherent risks, including potential involvement with armed groups, human rights violations, environmental degradation, and corruption.
Our Group is committed to promoting responsible mineral procurement in accordance with the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas. We aim to ensure that our activities do not contribute to conflicts, human rights violations, or any related issues.
- We will establish an internal management system for responsible mineral procurement.
- We request our business partners to procure minerals in compliance with the Responsible Minerals Assurance Process (RMAP).
- Using the Responsible Minerals Initiative (RMI) questionnaire, we will examine the supply chain, including identifying the origin of minerals and refining facilities.
- If this investigation reveals significant risks, we will take corrective measures together with our business partners, such as requesting changes in the supply chain.
- We will ensure appropriate disclosure of information to stakeholders regarding our efforts in responsible mineral procurement.
We ask our business partners to actively collaborate with the Seiko Group in our commitment to responsible mineral procurement.
