Promotion of supply chain management

Basic Concept

In recent years, environmental issues, such as the depletion of limited natural resources, water shortages, and global warming are becoming more evident, and there is a growing sense of urgency about global sustainability.
In addition, social issues, such as human rights and labor are becoming increasingly serious, and organizations are required not only to comply with the laws and regulations of each country, but also to respect internationally recognized standards and principles and the spirit under which they were established, and to contribute to the realization of a sustainable society.
Based on the belief that sustainability initiatives can only be completed through the involvement of the entire supply chain, our Group will not only work to provide products and services that contribute to resolving social issues, but also promote socially and environmentally friendly procurement activities.

• Carlit Group Basic Policy for Sustainable Procurement
• Carlit Group Sustainable Procurement Guidelines
• Implementation of Sustainable Procurement Questionnaires

Carlit Group Basic Policy for Sustainable Procurement

The Carlit Group conducts fair and equitable purchasing activities in compliance with laws and regulations and with high ethical standards.
To realize a sustainable society, we will fulfill our social responsibility as a corporation by giving due consideration to environmental conservation, resource protection, safety and human rights, etc.

1. Promotion of fair and equitable transactions

   • We select suppliers based on a fair evaluation of the safety, quality, price, and delivery time of products and services, transparency and stability of corporate management, manufacturing and supply capabilities, sustainability measures, and other factors.
   • We open the door to procurement and provide fair entry opportunities to suppliers.

2. Building trusting relationships with business partners

   • Based on the basic understanding that our suppliers are partners in the execution of our business activities, we aim to deepen mutual understanding and build long-term relationships of trust.
   • We faithfully execute contracts with suppliers and properly manage confidential and personal information related to procurement activities.
     In addition, we do not engage in procurement transactions that infringe the intellectual property or other rights of third parties.

3. Compliance with laws and social norms

   • In carrying out procurement activities, we comply with relevant laws and regulations.
   • We do not engage in illegal activities to entertain or offer gifts to business partners in accordance with laws and internal standards.
     In addition, procurement personnel do not give or receive personal benefits in the performance of their work.

4. Environmental considerations

   • We proactively address climate change and work to reduce greenhouse gas emissions.
   • We work to conserve biodiversity, protect and maintain resources, and improve the environment.
   • We work to reduce waste and recycle resources and energy.

5. Respect for human rights

   • We eliminate all human rights violations, including forced labor, child labor, and harassment throughout our supply chain.

Carlit Group Sustainable Procurement Guidelines

In order to realize a sustainable society, we have established the "Carlit Group Basic Policy for Sustainable Procurement" and the "Carlit Group Sustainable Procurement Guidelines.
In the supply chain we have built with the suppliers that provide us with raw materials and services, we will follow these guidelines as we strive to realize a sustainable society by ramping up our efforts and partnerships aimed at carrying out responsible procurement with due consideration for the environment and society.

1. We will promote CSR and actively carry out activities that contribute to society.

   • We will respect our stakeholders and contribute to the realization of a healthy and sustainable society.
   • We will actively engage in activities that contribute to society and the local community.

2. We will maintain and strengthen compliance (compliance with laws and regulations, etc.), fair trade, and corporate ethics.

   • We will conduct our business operations in a fair and impartial manner without going against social norms.
   • We will comply with laws and regulations.
   • We strictly prohibit corruption and bribery with any and all stakeholders.
   • We will not engage with antisocial individuals or organizations.
   • We will take measures to prevent and detect misconduct.
   • We will respect the intellectual property rights of others and thoroughly comply with relevant laws, regulations, and rules to prevent unfair infringement.

3. We will maintain and strengthen our environmental activities.

   • We will endeavor to make effective use of resources and conserve energy, such as improving the efficiency of water, electricity, and other energy usage.
   • We will reduce our emissions of pollutants into environmental media such as the air, water, and soil.
   • We will promote the 3Rs, namely: reducing, reusing, and recycling waste.
   • We will promote green procurement and green purchasing to reduce our environmental impact.
   • We will work to reduce greenhouse gas emissions and mitigate climate change.
   • We will promote initiatives for biodiversity conservation, such as nature conservation.
   • We will manage chemical substances appropriately and safely.

4. We will ensure quality and safety in the products we supply.

   • We will carry out quality assurance activities and make continuous improvements.
   • We will ensure safety by working to reduce potential risks while complying with laws and regulations.

5. We will respect human rights.

   • We will strictly prohibit inhumane acts such as child labor, forced labor, abuse, and human trafficking.
   • We will strictly prohibit discrimination on the basis of gender, nationality, race, creed, age, disability, LGBT, etc.
   • We will prevent harassment that undermines the dignity of individuals.
   • We will promote responsible procurement in accordance with the Conflict Minerals Regulation.
   • We will comply with laws and regulations regarding occupational health and safety, pay attention to the health of employees, and strive to create a safe and comfortable workplace.
   • We will comply with laws and regulations and work to reduce excessive working hours.
   • We will pay appropriate wages in accordance with laws and regulations.
   • We will comply with laws and regulations regarding freedom of association and the right to collective bargaining, etc., and support and respect the rights of employees.

6. We will disclose and communicate information to stakeholders in a timely and appropriate manner, and maintain and strengthen information security measures.

   • We will disclose information on products and services, the company's financial/non-financial information, and risk information, etc., in a timely manner, and strive to maintain and develop sound relationships with stakeholders.
   • We will manage confidential and personal information appropriately and strive to prevent leakage or loss of information.

Implementation of Sustainable Procurement Questionnaires

Based on the above, we started conducting a Sustainable Procurement Questionnaire with the aim of working with suppliers to build a responsible supply chain.
In fiscal 2022, the first year of the questionnaire, we collected data from each operating company with the goal of covering 70% of the total procurement value. Through regular implementation, we will continue to expand the scope of the questionnaire and analyze and provide feedback on the results. If matters of concern arise, we will strive to reduce risk across the entire supply chain, such as by engaging in dialogue with suppliers to improve/resolve the issue(s).