Basic Policy

The Sumitomo Forestry Group signed the United Nations (UN) Global Compact in 2008. Subsequently, in July 2019, we formulated the Sumitomo Forestry Group Human Rights Policy with respect for the International Bill of Human Rights (Universal Declaration of Human Rights and International Covenants on Human Rights), the core labor standards of the International Labour Organization (ILO), and the United Nations (UN) Guiding Principles on Business and Human Rights. Then, in April 2023, in order to show the Sumitomo Forestry Group’s commitment to respecting human rights even more clearly, we revised the Sumitomo Forestry Group Human Rights Policy in reference to relevant international guidelines, such as the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct. In the revised policy, we also describe our ideas about human rights-related cooperation with our business partners as well as about our support and expectations for their human rights-related initiatives. We also participate in the World Business Council for Sustainable Development (WBCSD) to grasp the trends of human rights-related initiatives that companies are expected to implement, as well as in the UN Global Compact and Global Compact Network Japan, including its Working Group on Human Rights Due Diligence (HRDD). Moreover, with the Sumitomo Forestry Group Code of Conduct, which is based on the above-mentioned international norms, we uphold the creation of “A respectful, healthy workplace.” To this end, the Code states that we shall respect the human rights of all individuals, including minorities and vulnerable people such as women, children, indigenous people ; shall not discriminate on the basis of race, ethnicity, nationality, gender, religion, ideology, disability, sexual orientation, gender identity or other; and shall not tolerate forced labor or child labor in any form.

The Group is also working to raise the awareness of its business partners about the details of its Human Rights Policy and Code of Conduct and is making an effort to fully grasp and mitigate human rights risks by implementing human rights due diligence and responding appropriately to human rights risks. We also give the maximum possible support where necessary to our business partners in their initiatives to respect human rights.

Implementation of Due Diligence and Response to Significant Human Rights Issues

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

Identifying Significant Human Rights Issues

In order to enhance our human rights due diligence measures, we have been conducting workshops on human rights due diligence to which we invite external experts as lecturers since 2017. In 2019, we created the Sumitomo Forestry Group Human Rights Impact Analysis Map and reviewed it in 2020 and 2025.

2019: Mapped risks to stakeholders in the value chain for each division, analyzed their impacts, and identified the importance and priority of human rights risks for each division

2020: Reviewed the map, regarding the impact of the spread of COVID-19 infections as a new risk factor

2025: Reviewed the map to specify existing and potential issues in light of the most recent business environment

The following shows the significant human rights issues identified by our Group and how they are related to each of our businesses.

Response to Identified Issues

For identified issues, we take measures and corrective actions to reduce relevant risk factors for each business. In fiscal 2021, regarding “respect for the rights of indigenous peoples and local communities,” we reviewed the operational status of the grievance mechanisms in our overseas forestry business. Specifically, we checked the actual measures implemented under the mechanisms and identified the points to be corrected, with a focus on further reducing related risks and building better relationships with stakeholders in the areas where we develop our business. As a result of an online review conducted by a third-party organization, we verified that appropriate grievance mechanisms are in place at all of our three overseas tree planting sites in Indonesia, Papua New Guinea, and New Zealand. These systems allow for continuous consultation with local government agencies and communities. On the other hand, it has been revealed that further improvements need to be made to expand external information disclosure and incorporate the results of dialogue with rightsholders into the grievance mechanism.

In planning new businesses and projects, Sumitomo Forestry conducts risk assessments for the entire supply chain. Social aspects, such as human rights considerations for workers and other stakeholders, are also covered in the assessment.

Going forward, we will formulate measures and action plans to prevent, avoid, mitigate, and correct human rights risks for each stakeholder, and will conduct a PDCA cycle to improve the related initiatives.

Operation and Improvement of Grievance Mechanisms

Sumitomo Forestry recognizes the importance of having grievance mechanisms (complaint handling mechanisms) in place. Accordingly, our Customer Service Department serves as a point of contact that handles requests for consultations from customers and neighbors of our housing construction sites. We also have a compliance hotline, an external consultation service through the Employee Assistance Program (EAP) and a harassment hotline for business partners and employees. Moreover, we accept inquiries, including complaints, at our website in Japanese, English, and Chinese. Inquiries we receive through our website are forwarded by the contact point of the Corporate Communications Department to the relevant specialized department at the head office or to the responsible department for the appropriate treatment of the inquiry according to its details.

In October 2019, we put in place a whistleblowing mechanism shared by our overseas Group companies. For this system, we employed an external multilingual service operator to enable internal reporting in English, Chinese, Indonesian, Vietnamese, and Thai languages.

Moreover, in April 2026, we became a member of the Japan Center for Engagement and Remedy on Business and Human Rights (JaCER), with a view to providing a range of stakeholders, including Group employees, our business partners and people living in the neighborhood of our sites, with more convenient means to contact us. JaCER provides a platform for grievance redressal in line with the UN Guiding Principles on Business and Human Rights. JaCER operates the platform as an independent third party, and through it we accept complaints and reports about human rights violations from all stakeholders. The handling status of reports made through JaCER is disclosed on a grievance redressal list posted on JaCER’s website.

We will continue to improve our internal and external hotlines to prevent human rights violations and take necessary measures to remedy human rights violations should they occur.

Sumitomo Forestry Group Human Rights Impact Analysis Map

(Revised in April 2025)

Internal Sustainability Survey

Since fiscal 2012, the Sumitomo Forestry Group has been conducting an annual internal sustainability survey on the sustainability initiatives of each Group company, including their human rights-related measures. The survey results are reported to the Board of Directors via the Sustainability Committee, while improvements are made based on the results. In fiscal 2025, we surveyed the status of human rights training and the establishment of help desks for 71 Group companies (32 companies in Japan and 39 overseas). As a result, we have confirmed that company-wide human rights education and training, as well as internal rules and initiatives to address human rights violations, are either in place or planned. Also, as part of our efforts to prevent human rights violations in our value chain, we investigate the status of human rights-related communications and initiatives conducted by each Group company for their business partners and suppliers. According to the results of the survey conducted for fiscal 2025, there were no cases of human rights violations as defined in the Sumitomo Forestry Group Code of Conduct.

Sustainability Procurement Survey

The Sumitomo Forestry Group conducts fair and responsible procurement under the Sumitomo Forestry Group Procurement Policy, which obligates suppliers to protect human rights and workers’ basic rights as well as to prevent corruption. The procurement of imported wooden materials poses high human rights risks, so the Group checks these operations by conducting the Sustainability Procurement Survey on approximately 400 suppliers. Issues confirmed include violations of the rights of workers and local communities in the areas from which the products supplied to the Group and their raw materials are procured, as well as failures to give due consideration to the rights of local workers and communities in forest logging. Moreover, the Group engages in interviews and on-site surveys of suppliers for whom risk mitigation measures are deemed necessary in reference to the risk categories set for individual timber-producing countries. We also conduct the Sustainability Procurement Survey on both domestic and overseas suppliers of building materials and housing equipment.

Responding to UK Modern Slavery Act

Sumitomo Forestry established Sumitomo Forestry Europe Limited in the United Kingdom in 2022. Based on the Modern Slavery Act enacted in the country in 2015, the Group published a statement on its commitment to addressing risks related to modern slavery and human trafficking in its business operations and supply chains.

Respect for Human Rights in the Overseas Forestry Business

The following shows the examples of initiatives implemented by the Sumitomo Forestry Group in its overseas forestry business as part of its stakeholder engagement and grievance mechanisms.

In many countries and regions, indigenous people and local communities are entitled to land rights by official laws and common laws. The forestry business can contribute to local employment and social development, for which building and maintaining good relationships with local stakeholders is essential, as well as to the protection of human rights and the sustainability of our own business.

Initiatives in Indonesia

In our forestry business in the province of West Kalimantan in Indonesia, we conducted a survey jointly with International Finance Corporation (IFC), a member of the World Bank Group in 2012. Specifically in the survey, we examined whether or not the land use plan for our business site was appropriately implemented and whether or not we were giving due consideration to the lives of local residents in line with the policy of protecting the rights of indigenous people and their cultural heritages.

In 2013, we shared the outcome of the aforementioned survey at a stakeholder meeting to which we invited local community members, neighboring businesses, experts in relevant fields, NGOs, and government officials. At another such meeting in 2015, we helped stakeholders strengthen their understanding of our business and environmental measures prior to the logging of planted trees. In these ways, we have been conducting our forestry business with consideration for human rights.

In 2018, with the help of IFC, we established a grievance mechanism to collect opinions of local residents, either in writing or through regular visits, and give our replies to them within seven business days. In 2025, PT. Wana Subur Lestari (WSL) and PT. Mayangkara Tanaman Industri (MTI) received a total of 11 comments and requests through the mechanism and replied to all of them.

Initiatives in Papua New Guinea

Also, we have installed a suggestion box at Open Bay Timber Ltd. (OBT) in Papua New Guinea. Anyone from the local area can submit their comments, regardless of whether they are a member of the company or not. In 2025, several submissions were made to the box, including applications for participation in the cacao business and requests for road repairs. We have carefully examined the details and provided responses as appropriate. Through the suggestion box, we also accept requests for consultation not only from our employees but also from local residents. The existence of a mechanism that allows local residents to express their opinions also helps increase their trust in the company.

Initiatives in New Zealand

Tasman Pine Forests Ltd. (TPF) in New Zealand keeps a stakeholder registry in which they register the records of important communications made with local residents, partner companies and other stakeholders (e.g., communication at meetings with a local environmental organization and at meetings on our operation plan held with local residents). Communicating with local stakeholders based on an understanding of the background information recorded in the registry helps us to build favorable relationships with stakeholders.

Human Rights Training

The Sumitomo Forestry Group provides lectures about human rights in its new employee training in Japan. We also require all Group employees with access to the intranet to attend the “Work and Human Rights” e-learning seminar every year (which they complete by scoring 80 points in the test). This seminar promotes respect for human rights and helps create a workplace free from discrimination. This training seminar is also intended to enhance participants’ awareness and understanding about people with disabilities, foreign nationals, members of the LGBTQ community, and other minorities. In fiscal 2025, 14,411 employees (6,422 Sumitomo Forestry employees and 7,989 employees of its Group companies) attended the seminar. Sumitomo Forestry also incorporates training on human rights in its courses for newly appointed leaders. We will continue our efforts to raise employees’ human rights awareness via e-learning and training opportunities.

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. In the country, local Sumitomo Forestry Group companies strive to share Sumitomo Forestry’s policy and philosophy on the provision of fair opportunities and the prohibition of discrimination by describing them in the employee handbook and through other means.