Supply Chain Management

Supply Chain Management

Basic Policy

The Sumitomo Forestry Group recognizes its duty to ensuring human rights and addressing environmental issues in the supply chain of its businesses. We are contributing to the realization of a sustainable society throughout the entire supply chain by promoting the standardization of certified wood in the market.
For procurement, our Wood Procurement Philosophy and Policy was revised and renamed to the Sumitomo Forestry Group Procurement Policy in 2015. In 2017, also we drew up the Sumitomo Forestry Group Code of Conduct, which was expanded to include the supply chain. Through this and other measures, we have reinforced our Group-wide efforts.

Sumitomo Forestry Group Procurement Policy

The Sumitomo Forestry Group has been committed to responsible wood procurement activities by establishing Wood Procurement Standard and Wood Procurement Philosophy and Policy in 2005 and 2007 respectively. In 2015, with the Sumitomo Forestry Group Procurement Policy, we expanded our scope beyond wood to include a wide range of other procured products, such as metals, ceramics, resin and other building materials, and based on this policy, are engaged in procurement activities that take into consideration the economy, society and environment.

Sumitomo Forestry Group Procurement Policy

The Sumitomo Forestry Group utilizes wood as a renewable natural resource in its business operations. To contribute to a sustainable society, we are committed to procurement activities that take into account economic, environmental and societal interests and comply with the following policy:

  1. Procurement based on legal and highly reliable supply chains
    Our procurement activities will strictly adhere to all relevant laws, regulations and societal norms, and be built on mutual understanding and trust with our business partners. Furthermore, to provide the highest quality products and services, we will work with our business partners to ensure that our procurement takes place within a sound and fair supply chain.
  2. Procurement based on fair opportunity and competition
    We will provide all our suppliers, both Japanese and foreign, a fair opportunity for business. Selection of our business partners will be based on a comprehensive evaluation of the company's reliability and technological expertise, the product's quality, economic efficiency, delivery date and environmental performance, and the company's CSR (Corporate Social Responsibility) initiatives, such as advocacy of basic human and worker rights, anticorruption efforts and so on.
  3. Procurement of sustainable timber and wood products
    Wood is a renewable natural resource. To actively utilize it, we will work with our business partners on the following initiatives related to the procurement of timber and wood products:
    • Procure timber from forests that are sustainably managed
    • Work to improve the traceability of procured timber and wood products
    • Strictly adhere to the laws and regulations of the countries and regions we log in, protect biodiversity and forests with high conservation value, and respect the cultures, traditions and economies of regions that coexist in harmony with forests.
  4. Communication
    To ensure the transparency of our procurement efforts, we will disclose information appropriately. In addition, we will communicate with our stakeholders to further improve our procurement activities.

President and Representative Director
Toshiro Mitsuyoshi

Green Procurement Guidelines (extract)

Evaluation Items

1. Corporate activity assessment (evaluation of sustainability initiatives)

  • Environmental aspects
    • Formulate policies related to environmental symbiosis.
    • Set up departments to promote environmental symbiosis and appoint managers.
    • Raise awareness of policies related to environmental symbiosis among employees.
    • Confirm understanding of and compliance with environmental laws and regulations related to business operations.
    • Promote proper use of water resources and measure the amount of use.
    • Store, handle and process any hazardous chemical substances (including specified chemical substances, radioactive materials, and biological substances) used by the Group in accordance with a management manual, laws, and any other relevant regulations.
    • Properly manage and process waste in accordance with laws and regulations.
    • Promote proper use of energy and measure greenhouse gas emissions.
    • Formulate greenhouse gas reduction plans.
    • Make every effort to protect biodiversity and the ecosystem.
  • Social aspects
    • Overall Corporate Social Responsibility (CSR)
    • Formulate policies and standards for Corporate Social Responsibility (CSR) initiatives.
    • Establish departments to promote Corporate Social Responsibility (CSR) initiatives and appoint managers.
    • Conduct employee education and training about Corporate Social Responsibility (CSR) policies and standards.
    • Human Rights
    • Formulate policies and standards related to human rights.
    • Establish departments to promote human rights initiatives and appoint managers.
    • Conduct employee education and training about human rights policies.
    • Prohibit all forms of harassment and raise internal awareness.
    • Prohibit forced labor and child labor and raise internal awareness.
    • Properly manage employee work hours regulated by law.
    • Pay adequate wages to employees according to the minimum wages established by law.
    • Establish a system for employees to report any harassment, physical punishment or other abuse anonymously.
    • Prohibit all discrimination whether based on race, age, religion, nationality or gender and fully raise internal awareness.
    • Ensure employees have freedom of association and collective bargaining rights in accordance with laws and regulations.
    • Provide human resource development opportunities fairly to all employees, such as occupational skill development and training.
    • Occupational health and safety
    • Formulate policies and standards related to occupational health and safety.
    • Establish departments to promote occupational health and safety initiatives and appoint managers.
    • Conduct employee education and training about occupational health and safety policies.
    • Strive to maintain a safe and healthy work environment.
    • Properly manage the physical and mental health of employees as well as occupational safety, such as reducing occupational accidents and diseases.
    • Put in place measures to ensure employee safety in anticipation of natural disasters and other emergency situations and fully raise internal awareness.
    • Ethic
    • Prohibit bribery, embezzlement and other acts of corruption and fully raise internal awareness.
    • Raise internal awareness to protect intellectual property in accordance with laws, regulations and international rules.
    • Put in place whistleblowing mechanisms for employees and suppliers to report any legal violations.
    • Formulate responsible procurement policies.
    • Prohibit abuse of superior bargaining positions, encourage fair and free competition, and fully raise internal awareness.
    • Never tolerate influence from anti-social forces with a resolute attitude.
    • Information security
    • Collect and use personal information only within the scope agreed upon in advance and properly manage said personal information to prevent any informational leaks or unauthorized use.
    • Use the utmost caution to properly manage the handling of confidential information received from third-parties.
    • Put in place information security measures on computers and networks.
    • Product safety
    • Strive to ensure and improve quality and safety when supplying products and services to markets.
    • Supply chain
    • Require procurement suppliers to emphasize initiatives related to human rights and other social aspects as well as environmental aspects.
    • Social contributions
    • Build good relationships with and promote activities to contribute to local communities.

2. Product assessment

  • Common items
    • Requirements
    • Prohibit use of chemical substances restricted in Attachment 1, “Sumitomo Forestry Restricted Chemical Substance List.”
    • Never leach hazardous materials during construction or use.
    • Never produce chemical or other hazardous fine particles during construction or use.
    • Never produce sulfur oxide or other hazardous gases during incineration.
    • Initiatives
    • Prohibit use of vinyl chloride and styrene foam in packaging materials.
    • Limit use of packaging material to the bare minimum (strive to reduce packaging materials).
    • Incorporate measures to sort by material in any composite products for easy waste disposal.
    • Make component and material replacements easy to extend the lifespan of assembled products.
    • Clarify maintenance programs (procedures and periods for inspections, repairs and part replacements).
    • Make reuse or recycling after use possible.
    • Make reuse or recycling of package materials possible.
    • Use processes and materials to lengthen the lifespan of products.

Targets and Results of Supply Chain Management

The Mid-Term Sustainability Targets advocate the building of sustainable supply chains as one goal and set targets and promote initiatives related to sustainable procurement surveys with particular focus on our supply chains.

Our results for fiscal 2021 succeeded in a 100% implementation rate of sustainability procurement surveys for suppliers of imported timber and wood products and a 98.0% implementation rate in the domestic housing department, which achieved our targets.