Basic Policy

The Sumitomo Forestry Group formulated the Sumitomo Forestry Group Human Rights Policy in July 2019, participates internationally such as in the UN Global Compact and the World Business Council for Sustainable Development (WBCSD), complies with international human rights bills (Universal Declaration of Human Rights and International Covenants on Human Rights), the International Labour Organization (ILO) Core Labour Standards, the Ten Principles of the UN Global Compact and the United Nations Guiding Principles on Business and Human Rights. Based on these international standards, the Sumitomo Forestry Group has put forth a commitment to human rights respect and a healthy workplace in its Sumitomo Forestry Group Code of Conduct. In addition, the Code calls for the respect of the human rights of all individuals, including women, children, indigenous people, minorities and other socially vulnerable people and stipulates that there will be no discrimination whatsoever on the basis of race, ethnicity, nationality, gender, religion, ideology, disability, sexual orientation, gender identity or other. The Code also does not permit forced labor or child labor in any form.

Furthermore, the Sumitomo Forestry Group is permeating these policies and conducts proper assessments to ensure this same level of respect by business partners as well. We are also conducting human rights due diligence and respond to human rights risks in an effort to fully grasp and mitigate any risk to human rights.

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Implementation of Due Diligence and Managing Important Risks

Through human rights due diligence, Sumitomo Forestry Group identifies factors that may have a negative impact on human rights and works to prevent or reduce them.

Internal Sustainability Survey of the Sumitomo Forestry Group

Since fiscal 2012, an Internal Sustainability Survey is conducted every year at each of the Group companies to review their sustainability initiatives including the human rights. The Sustainability Committee reports the survey results to the Board of Directors and improves the human rights due diligence process of each site. In fiscal 2020, the Sumitomo Forestry Group conducted a survey about implementation of human rights training and the setup of rescue help desks for 59 primary Group companies in Japan and overseas (28 companies in Japan and 31 companies overseas). As a result, we verified 45 of these companies are conducting human rights training and 49 have setup rescue help desks while 53 are engaging in measures to mitigate risk to human rights. For each supplier, we strive to prevent human right infringements through conducting surveys and face-to-face interviews.

Based on this survey, in fiscal 2020, we did not find any human rights violations as defined in the Sumitomo Code of Conduct.

Respect for Human Rights Through Sustainability Procurement

Sumitomo Forestry Group is conducting fair and responsible procurement under the Sumitomo Forestry Group Procurement Policy which obligates suppliers to protect human rights and basic rights of labor as well as preventing corruption. For procurement of high-risk imported materials, specifically, the Group conducts sustainability surveys of all, more than two hundreds, suppliers in two years. The surveys aim to ensure whether rights of workers and local communities in the areas where raw materials of the supplies are procured from, have not been violated; if the risk identified, then whether adequate consideration for these rights during logging is inspected. The Group also engages in on-site inspection and interviews with any suppliers which measures to mitigate risks was deemed necessary based on the risk categories.

Identifying and Managing Human Rights Risks

In conjunction with the formulation of its Human Rights Policy, Sumitomo Forestry Group has created a risk map to clearly identify important human rights risks affecting stakeholders in the value chain of each of its business divisions in 2019. Also we re-reviewed the risk map considering the coronavirus disease (COVID-19) in 2020. We do a systematic periodic review of the risk mapping of potential issues.

We identified important risks as follows: The Environment and Resources Division - “Infringing indigenous or community land rights and managing related laws” as well as “Occupational safety and health management in mountain forests (dangerous work, etc.).” The Timber & Building Materials Division - “Infringing indigenous land rights,” “Occupational safety and health management at factories (fires, dust explosions, etc.),” and “Child labor at timber plantations (including dangerous operations).” The Housing and Construction Division and the Overseas Housing and Real Estate Division - “Labor conditions of migrant workers (forced labor, etc.).”

In addition to the risk measures already put in place, we have identified more risks in fiscal 2020, of which we have verified the condition of respect for human rights of foreign technical trainees which is the particular importance and of major social interest in Japan. Third-party agencies gathered feedback from partner building contractors and organizations supervising technical trainees, verified materials, and interviewed technical trainees from overseas learning skills in Japan. As a result, we confirmed there were no major human rights violations.

In addition to risk measures identified by each business division, the Company is working on countermeasures and implementation plans for each stakeholder to further prevent, avoid, lessen or rectify these identified important risks in the future.

Sumitomo Forestry Group Human Rights Impact Analysis Map

Sumitomo Forestry Group Human Rights Impact Analysis Map

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Respect for Human Rights at Overseas Plantations

For timber plantations in Indonesia's West Kalimantan, the Company signed an advisory agreement with International Finance Corporation (IFC), the World Bank's group institute in 2012. Sumitomo Forestry conducted inspections of its operational properties with the IFC to examine whether plans for use of commercial land were being implemented properly considering the rights of indigenous people and protection of cultural heritage as well as livelihood of local residents, which are indicators in the High Conservation Values Forests (HCVF) that has drawn great attention in recent years.

Sumitomo Forestry Group held hearings and invited stakeholders (local residents, neighbor corporations, academics, NGOs, and government workers) to conduct forest operations with considerations toward human rights. Hearing was held in 2013 to share the content and result of a survey and hearing held in 2015 to deepen stakeholders understanding about content of the business and environmental considerations prior to harvesting the plantation forest.

In 2018, the Group built a grievance mechanism with the help of the IFC in PT. Wana Subur Lestari (WSL) and PT. Mayangkara Tanaman Industri (MTI). This mechanism provides two routes for grievances. The first allows local residents to share their opinion in writing with WSL or MTI while the second provides WSL and MTI the opportunity to conduct visits with local residents to gather feedback. WSL and MTI respond to any grievances from local residents from both routes within seven business days based on the approval from the management. In addition, the Group has begun social surveys and issued a report in 2020 as part of the three-year plan with the University of Indonesia around its business zones and neighboring area.

Open Bay Timber Ltd. (OBT) in Papua New Guinea has also put in place a complaint box in which anyone from the area regardless of whether from within or outside of the company can post a complaint or comment. OBT received several complaints for example about wages in 2020, and it properly responded to any of these complaints requiring action after careful investigation. Because this complaint box does not only receive feedback from employees but also local residents and other third parties, trust in OBT has grown thanks to a means to share one’s own thoughts with the company.

Moreover, Tasman Pine Forests Ltd. (TPF) in New Zealand registers any important exchanges with local residents, partner companies and other stakeholders in a stakeholder registry. Communication with a recognition of the past background helps to build smooth relationships.

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Human Rights Training

The Sumitomo Forestry Group provides lectures about human rights in its new employee training in Japan. Sumitomo Forestry also incorporates classes about human rights in its training for new general managers. We also require all Group employees with access to the intranet to take the “Work and Human Rights” module in e-learning every year with the intention to promote respect for human rights and a workplace where no discrimination is permitted (completed with a test score of at least 80 points). This training course also includes curriculum to encourage understanding about people with disabilities, foreign nationals, LGBT and other minorities. In fiscal 2020, 10,873 employees of whom 4,276 and 6,597 belong to the parent company and Group companies, respectively, took the class. The effort in raising human right awareness via e-learning will be continued into the future.

Initiatives in the United States

In the United States, federal and state laws prohibit any employment discrimination for reasons such as race, gender, religion, birthplace, or health condition. Sumitomo Forestry Group companies in the United States strive to share the same philosophy in prohibiting discrimination and providing fair opportunities, by including these topics in the employee handbook.

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Prevention of Harassment

Sumitomo Forestry makes its policy on sexual harassment, workplace bullying and maternity harassment clear, having included in its Employment Regulations, under one category of rules to be observed by employees (discipline on the job), a provision prohibiting such harassment as well as disciplinary standards. The Sumitomo Forestry Group Code of Conduct also prohibits all forms of harassment and this is communicated via the internal website, employee handbooks and handouts. In addition, awareness within the Company is fostered by providing information with case examples and implementing regular awareness promotion notices, through human rights and ethics training and other activities. Furthermore, the Group distributes an email to every employee from the General Manager of the Personnel Department every six months to raise awareness about stopping all harassment.

Furthermore, a framework to properly handle inquiries and complaints was put in place in fiscal 2000 with the establishment of the Harassment Consultation Hotline within the Personnel Department and Compliance Hotline both inside and outside of the Company. The privacy of all those involved is protected and every effort is made to ensure that neither the complainant nor those cooperating are treated detrimentally.

Initiatives in the United States

Each of our Group companies in the United States also engages in various other measures, such as consultation hotlines to report harassment and discrimination in the workplace. Crescent Communities has put in place initiatives to provide comfortable environments for employees to work beyond strict legal compliance, such as the adoption of a system whereby a corporate insurance policy covers 60% of the salary of an employee who cannot work for seven days or more due to reasons such as injury, illness, or mental disease.

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Sustainability Report