Sustainable Procurement Activities

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Yokogawa has focused on developing a supply chain that considers environmental protection and human rights. We will actively identify risks that impede sustainable procurement, taking the path to improvement with our business partners, and strengthening activities aimed at achieving our sustainabiliy goals "Three goals".

 

Summary of Activities

We are identifying risks that impede sustainable procurement with our business partners, focusing on understanding the actual conditions of the following 4 areas(defined in Yokogawa Group Sustainable Procurement Guidelines for Suppliers) : "Labor and Human rights" "Health and safety" "Environment" and "Ethics". In case a risk is realized, we work with our suppliers to take measures against it. We also develop educational programs on sustainable procurement both inside and outside the company. We set KPIs to manage and measure progress of sustainable procurement activities.

 

Report on Results of Activities in FY20

In 2020, we positioned the year as the starting year for sustainable procurement, and conducted activities to reduce CSR risks in the supply chain based on human rights due diligence.

How to proceed with activities

1) PDCA cycle of activities

Based on the KPIs established in FY 19, we will strive to reduce supply chain CSR risks through communication with suppliers. The cycle of its activities is illustrated below.

 

PDCA cycle of activities

 

2) Analysis of FY 20 “Self Assessment Questionnaire(SAQ)” Results

In sending the SAQ, we selected 200 companies and asked them to respond. As a result, we received SAQ responses from 166 business sites.
The SAQ divided the questions into three categories and scored them based on their answers. The average score rate is as follows.

Analysis of FY 20 SAQ Results

 

3) Our actions for implovemt CSR risk

We sent to every facilities that had submitted our SAQ sheets our feedbacks which we had described the SAQ scores and improvement points. We also held dialogues with facilities whose SAQ scores were less than 60% by using the communication sheet.
In 2020, due to the influence of COVID-19, we were not able to visit facilities, but we were able to ask for their cooperation in improving them through hearings based on SAQ responses.

 

Relation for Addressing of Conflict Minerals

The SAQ respondents covered majority of suppliers who requested for our CMRT*1 surveys. Because we always take care about materials(including 3TG) that we need to purchase.


In order to conflict minerals, we  will not only request CMRT surveys related to requests from customers, but also visualize information and risk assessment so that we can actively collaborate with customers and cooperate with related departments.
CMRT *1 : Conflict Minerals Reporting Template

 

Education

We have prepared e-Learning for sustainable procurement, and provide a system that allows those involved in procurement activities to take courses on demand. This system is used as a training material. We also hold annual fairs for engineers to promote sustainable procurement. In January 2021, a session on conflict minerals was held. We also actively participate in the formulation of the JEITA Responsible Corporate Behavior Guidelines and contribute to the Japan Society of Engineers, Inc. on sustainable procurement

 

Activity plans and results

Yokogawa group is formulating its sustainable procurement activities with reference to ISO 20400 (Guide to Sustainable Procurement). Since fiscal 2020, we have been conducting a cycle of identifying high-risk business sites, providing written feedback and monitoring on the site, by receiving support from experts and evaluating responses from suppliers.

 

1) SAQ Implementation Plan and Results

With expert advice we have chosen approximately 600 companies as SAQ targets in high-risk industries among the top 1070 companies with the highest purchase volume from approximately 10,000 companies. Our target is to conduct SAQs approximately 200 suppliers every year and provide feedbacks to them.

SAQ Implementation Plan and Results

We conducted a risk assessment based on the knowledge of experts for the top 1070 companies within suppliers(approximately 10,000 companies) which have purchase records of the entire Yokogawa Group, and selected 600 companies as targets of SAQ. Our group planed to evaluate and improve these 600 companies over the next 3 years. In 2020, we selected suppliers' business sites for 200 out of 600 companies and conducted SAQ and provided feedback.

 

KPI

Cumulative number of Companies

Number of sended SAQ companies

Number of facilities of got filled out SAQ

Target year

Number of work-places of suppliers executing SAQ

200 companies

191 companies

166 facilities

FY 2020

400 companies    

FY 2021

600 companies    

FY 2022

 

2)Supplier agreement to our sustainable procurement policy

We have confirmed our support for sustainable procurement initiatives in our group's supply chain in order to work together with our business partners to make improvements.

     

KPI

Cumulative number of facilities

Number of facilities that agreed our code

Target year

Number of Suppliers who Support Sustainable Procurement

70 facilities

135 facilities

FY 2020

140 facilities  

FY 2021

210 facilities  

FY 2022

 

 

 


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