We aim to realize globally optimal procurement based on our quality products principle. To this end, we focus on strengthening cooperation with suppliers and promoting our CSR efforts throughout our supply chain system, while at the same time striving to carry out proper purchasing transactions when procuring materials and parts, based on the following guidelines:
- We conduct rational transactions based on fair, transparent, and open competition.
- We comply with procurement-related laws and regulations and foster responsible procurement. We select suppliers based on comprehensive assessment of product quality, technology, prices, deliveries, CSR initiatives, and efforts to continuously make improvements.
- Aiming to procure more eco-friendly products, we strive to promote our green supplier system.
- We enhance mutual trust with our suppliers, who are good partners for us, and strive to realize mutual development.
Promoting Responsible Procurement
Taking seriously the recent social and environmental issues related to our supply chain, we are promoting responsible procurement activities that not only comply with various laws and regulations, such as the Subcontracting Act, but also give due consideration to human rights and the environment. By responding to expectations from society in cooperation with our diverse suppliers across the supply chain, we contribute to the realization of a sustainable society.
Promoting CSR and sustainability procurement
To foster CSR and sustainability measures across the supply chain, we issued our CSR and Sustainability Procurement Guidelines and have been distributing copies to suppliers.
CSR and Sustainability Procurement Guidelines
The CSR and Sustainability Procurement Guidelines set the rules that our suppliers are requested to comply with concerning the environment, human rights and labor, business continuity planning (BCP), business ethics, information security, occupational health and safety, product quality and safety, and management systems. We ask our suppliers to put them into practice together with the NGK SPARK PLUG Group. We also ask our suppliers to distribute copies of the Guidelines to their own suppliers.
To monitor the status of implementation by the suppliers, we conduct surveys every two years using a check list and provide feedback on the results. For the survey we conducted in fiscal 2019, we received responses from 98% of the subject suppliers. For some suppliers, we held interviews with management and provided other follow-ups, thereby asking for improvement.
Ensuring green procurement
In order to reduce our environmental impact throughout the supply chain, we issued the Green Procurement Guidelines to request that suppliers build environmental management systems and ensure the strict management of environmentally hazardous substances.
Green Procurement Guidelines
These guidelines explain the basic concepts of our green procurement based on our environmental policies. We reviewed the list of related chemical substances in July 2021 and released version 11.01 of the guidelines. We ask our suppliers to study the guidelines and cooperate with our green procurement.
We certify suppliers that meet our system and material standards prescribed in “Green Procurement Guidelines” as "green suppliers," and give priority to these in purchasing.
As of fiscal 2020, we have certified 104 suppliers involved in facilities/jigs and tools, building/incidental facilities, and 153 suppliers involved in raw/subsidiary materials, parts, processing and outsourcing.
Measures against conflict minerals
There are concerns that some mineral resources mined in the Democratic Republic of the Congo and surrounding countries provide a source of funding to local armed forces, thereby promoting conflicts and infringements of human rights. This issue of conflict minerals is recognized as a serious social issue in relation to the procurement of resources and materials.
Accordingly, we annually conduct surveys on the use of conflict minerals targeting the upstream section of our supply chain and avoid the use of any with related risks.
Measures to respect human rights
To ensure respect for human rights of all people who are related to our suppliers and their suppliers, we have specified prohibited actions regarding human rights in the CSR and Sustainability Procurement Guidelines, and we check the status of compliance of our suppliers on a regular basis.
Measures to tackle climate change
To foster measures across the supply chain, including our suppliers, toward achieving “carbon neutral,” the CSR and Sustainability Procurement Guidelines require suppliers to set targets for reduction of greenhouse gas emissions and promote efforts for reduction.
Activities to Support Suppliers
By conducting activities to help suppliers enhance their business foundation and engaging in follow-up activities after our regular evaluation of them, we make joint efforts for improvement with suppliers, thereby building greater trust.
Activities to help suppliers enhance their business foundation (through classroom seminars and practical seminars held on-site)
For suppliers, we organize classroom seminars on themes such as process improvement, QC, occupational health & safety and the environment and also hold practical seminars at their own manufacturing facilities to foster improvements. We have been conducting these activities to help suppliers develop their workers in order to build a more robust business foundation. In FY2020, we held a total of 24 such seminars, including online seminars that we newly introduced. We are thus implementing our “Quality Product” policy and improving our manufacturing abilities in cooperation with suppliers.
Follow-up activities conducted after the regular evaluation of suppliers
We annually conduct evaluation on some suppliers and inform them of the results. For suppliers that require follow-up activities, we visit them to provide targeted advice and inspect their sites in order to work with them in thinking about how to rectify any weak points. We also award suppliers who have been evaluated as excellent.
Declaration of Partnership Building
In support of the Declaration of Partnership Building established by the Council on Promoting Partnership Building for Cultivating the Future*, we have released our own declaration. We are committed to promoting the coexistence and co-prosperity of the entire supply chain, building new partnerships regardless of the size of business and beyond the boundaries of business affiliations, and ensuring compliance with the “promotion standards.” At the same time, we implement proper purchasing transactions in accordance with the Procurement Policy.
* The members are the Chairman of the Japan Business Federation (KEIDANREN), the Chairman of the Japan Chamber of Commerce and Industry, the President of the Japanese Trade Union Confederation (RENGO), and relevant Ministers (Cabinet Office, Ministry of Economy, Trade and Industry, Ministry of Health, Labour and Welfare, Ministry of Agriculture, Forestry and Fisheries, and Ministry of Land, Infrastructure, Transport and Tourism).
Helpline for Suppliers
We have opened a Helpline as the contact point for suppliers to report any violation by managers or employees of the NGK SPARK PLUG Group.
Details are provided in the pamphlet distributed to the suppliers.