Human Resources Development
We proactively provide personnel in charge of procurement at Toyota Industries and affiliated companies with education to enhance procurement knowledge. In fiscal 2022, we provided education mainly on Japan’s Subcontracting Law as well as topics related to sustainability such as human rights and the environment. We also thoroughly inform personnel in charge of procurement about our response to the Japanese government’s initiatives and guidelines aimed at ensuring fair subcontracts.
Procurement Risk Management
1.Sustainability-Related Efforts in the Supply Chain
＜Sustainability Guidelines for Suppliers＞
To work together throughout the supply chain to realize a sustainable society, we publicize the Sustainability Guidelines for Suppliers (formerly, the CSR Guidelines for Suppliers), which describe our requirements for suppliers related to safety, human rights, labor practices, the environment, compliance and other topics. With increasing importance placed on procurement giving due consideration to human rights and environmental issues, we revised the guidelines in December 2021 and distributed them to suppliers while thoroughly informing them about the content. We have confirmed their compliance with the guidelines by performing an annual check on existing suppliers and requesting new suppliers to perform a self-inspection using a checklist and following up on their efforts. Moreover, through a periodic check on commodity items of concern, we are striving to maintain healthy transactions and reinforce a related structure throughout the supply chain.
Rate of performing a sustainability check on applicable suppliers (non-consolidated):100%
＜Safety and Health Activities＞
We visit the sites of our major suppliers in person to conduct a genchi genbutsu safety and health inspection*1. We also hold sessions to explain our Occupational Safety and Health Policies. Based on the analysis of accidents that occurred in the previous fiscal year and information on legal revisions, we promote safety and health activities for the next fiscal year for the prevention of similar accidents through these sessions.
With a view to seeking zero accidents (fires and explosions), industrial accidents and disorders on the premises of Toyota Industries, we have established the Safety and Health Council with subcontractors located on our premises. We jointly create a comfortable working environment by sharing information on accidents and disorder prevention activities of Toyota Industries. Using past accident cases as a reference, we periodically share various information, including matters that should be observed to prevent similar accidents, with subcontractors of outsourced work. We also request their cooperation to perform risk assessment in the construction work planning stage to identify associated risks. In addition, we encourage them to always discuss in advance a safe work method with the departments of Toyota Industries planning a construction project.
*1: Canceled due to COVID-19 in fiscal 2021 and fiscal 2022
＜Responsible Procurement of Minerals＞
As one initiative for respecting human rights, we stipulate our Policies for Responsible Procurement of Minerals. Based on these policies, we conduct a periodic check to confirm that applicable suppliers do not use minerals that have concerns for the funding of armed groups or for the abuse of human rights, such as child labor, forced labor and mining under poor working conditions.
Rate of performing a conflict minerals check on applicable suppliers (non-consolidated): 100%
＜Declaration of Partnership Building＞
We publicly announced our Declaration of Partnership Building on September 1, 2021, and have been striving to form a good relationship with our suppliers. The declaration clarifies that we make corporate and focused efforts to realize co-existence and co-prosperity with our entire supply chain, start new forms of collaboration regardless of a company size and corporate group affiliations, and observe the preferred trade practices between a parent business operator and its subcontractors (included in the business promotion criteria of the Act on the Promotion of Subcontracting Small and Medium-sized Enterprises).
＜Hotline for Suppliers＞
In 2016, we set up a hotline for our suppliers to report and inquire about possible compliance violations in Toyota Industries’ procurement activities to ensure early detection and the prevention of problems.
2．Business Continuity Management (BCM)
In further promoting BCM, we are making concerted efforts with suppliers to reduce associated risks by implementing specific measures. In fiscal 2022, to deal with frequent natural disasters in recent years, we rebuilt a system to identify disaster-induced damage on suppliers. Previously, we had conducted an impact survey on suppliers by concurrently using multiple systems required by each customer. In place of these systems, we adopted a new, unified system, which has enabled us to perform the impact survey in a more efficient and timely manner.
Moreover, in order to recover quickly and maintain production, we have reinforced our flood control measures at each base while at the same time accumulating inventories and examining ways to decentralize suppliers and production bases.