Initiatives Related to Suppliers
NGK procures raw materials and components guided by a basic policy centered on three principles: “Open and Fair,” “Partnership,” and “Relationship with Society.” In addition, together with the supplier companies that constitute our supply chain, we are actively working to ensure thorough legal compliance, disclose information, and promote green procurement.
In procurement activities we endeavor to comply with laws and ordinances related to procurement (including laws and regulation relating to export management and those relating to environmental conservation) and to maintain the social environment and social order.
As part of this commitment, in fiscal 2008 we signed a Memorandum of Understanding with every supplier company that states that each company pledges not to do business with antisocial forces or organizations. Furthermore, we strive to raise the level of transparency and fairness in procurement in order to prevent possible illegal actions on our part as the ordering party. Our efforts here include steps to ensure fair business practices through compliance with the Act against Delay in Payment of Subcontract Proceeds, Etc., and establishment of a helpline specifically for suppliers.
In its Purchasing Department NGK conducts education and training on laws pertinent to its relationships with suppliers. Departments responsible for purchasing at Group companies in Japan receive the same guidance through a liaison committee.
In a bid to reduce environmental load across its entire supply chain, NGK conducted a survey of environmental measures by suppliers in fiscal 2008. The survey targeted roughly 400 companies that have yet to obtain third-party environmental certification.
As a result of this survey, we learned that of our network of approximately 850 suppliers, some 560 companies including suppliers that have already acquired third-party certification, are promoting initiatives at or beyond the set baseline level.
In light of these results, we have decided to establish green supplier certification criteria and introduce a certification system in fiscal 2009. Suppliers failing to meet these certification criteria will be required to address issues necessary for certification, including the formulation of their own environmental policies, after consideration of their respective business characteristics, track record as suppliers and corporate size.
Furthermore, NGK drafted Green Procurement Guidelines in accordance with European chemical regulations and similar directives governing the handling of specified chemical substances. NGK requires suppliers to have a thorough awareness of these guidelines and is studying the uniform application of the guidelines for all Group companies going forward.
We hold regular explanatory meetings covering NGK’s earnings forecasts, our procurement initiatives (environmental and legal aspects) from a CSR viewpoint, and other pertinent matters for the benefit of our major suppliers.
At an earnings results presentation held in May 2009, we offered an explanation of NGK’s upcoming initiatives regarding green suppliers.
Earnings results presentation for suppliers (held in May 2009)
