Procurement philosophy and policy

We strive to conduct fair and equitable transactions by providing a wide range of opportunities for entry regardless of company size, transaction record, nationality or region, and are committed to procurement activities in line with our philosophy and principles, aiming for co-existence and shared prosperity with suppliers.
Based on the CSR Guidelines for Suppliers and Declaration of Partnership Building, Suzuki will proactively promote in its supply chain respect for human rights, elimination of substances of concern and also appropriate transactions, in order to contribute to the realization of a sustainable society.

Suzuki CSR Guidelines for Suppliers

Stakeholders including business partners of Suzuki are becoming more multinational and diversified as our business activities are developed globally. Therefore, we are expected to fulfill social responsibilities with due consideration for other cultures and histories, in addition to following laws and ordinances, and the social norms of each country.
Based on such social demand, we compiled the basic concept and practices of social responsibilities that we should accomplish with our business partners as Suzuki CSR Guidelines for Suppliers. Upon making procurement throughout the Suzuki Group, we ask our business partners to comply with the guidelines. We kindly request our business partners to understand the purpose and cooperate with us to promote CSR activities together.
https://www.globalsuzuki.com/corporate/environmental/green_policy/pdf/suzukiGreenGuideline.pdf

(Efforts to maintain workable guidelines)

• (1) In the basic principles of the Basic Purchase Agreement that we conclude with our business partners, we state clearly that “both we and our business partners shall recognize our social responsibilities in civic society and comply with relevant laws and regulations, both in Japan and overseas,” and strive to conform to social norms.
• (2) Once a year the Procurement Policy Presentation is held for Suzuki suppliers and we ask them to strengthen their response to human rights in the supply chain (improving benefits for foreign nationals, inspecting the supply chain to check on whether they are using minerals related to human rights, etc.), realizing carbon neutrality, avoiding use of substances of concern, etc. and for thorough compliance. With regard to human rights in particular, we hold separate training for suppliers and those in charge of procurement and strive to promote understanding by sharing the latest information.
• (3) Efforts are made in understanding the environmental conservation initiatives of our business partners by conducting research on greenhouse gas emissions and water consumption once a year.
• (4) In order to prevent one-sided cost reduction requests and delays in payment to subcontractors throughout the entire supply chain, we hold case-by case presentations to make all aware of proper trading.
• (5) In the case of any compliance issues or doubts regarding transactions with Group companies, we work to resolve them through the use of our whistleblowing hotlines (Suzuki Group Risk Management Hotline and those run by third-party organizations) for consultations.
• (6) Quality audits are held periodically (frequency based on rank in quality) under the Supplier Quality Assurance Manual that compiles Suzuki’s basic policy, activities and requests for quality assurance.

●Suzuki Green Procurement Guideline

Please refer to here for our initiatives for promotion of green procurement.
* Green Procurement Guideline
https://www.globalsuzuki.com/corporate/environmental/green_policy/pdf/suzukiGreenGuideline.pdf

Declaration of Partnership Building

Based on this Declaration of Partnership Building, Suzuki is:

• Strengthening cooperative relationships with our business partners, whom we regard as important counterparts, to create new value in diverse areas such as development, manufacturing, quality, and cost reduction.
• Working to improve our transaction practices in compliance with the Subcontract Act and the Promotion Standards of the Act on the Promotion of Subcontracting Small and Medium-sized Enterprises.
• Working to increase opportunities for information exchange with our business partners to learn about product (and parts) delivery problems, financing concerns, and other issues, and take sincere measures to resolve them promptly.

Promotion structure

Building stronger partnerships of reliability with suppliers advances stable and sustainable procurement, and for that reason, Procurement Strategy chooses suppliers and engages in procurement activities based on rules and procurement policies. Among those, for issues such as respect for human rights in the supply chain and preventing environmental destruction, associated departments such as the Sustainability Promotion Group, Product Environmental Affairs Promotion Group and Procurement Strategy and overseas sites collaborate closely and share information, which is used as a base to respond. These activities are periodically reported to the Executive Committee and important projects are submitted to the Board of Directors for decision-making.

Promoting sustainable transactions

Sustainable relationships

In creating trusting relationships with our business partners, we aim to establish sustainable relationships. For that purpose, we regard mutual communication as the most important factor, and make efforts for mutual understanding by holding the Procurement Policy Presentation once a year to enable our business partners to share and understand Suzuki’s policy, product and production plans, as well as to inform them of our procurement policy based on those plans.
Also, we share ideas not only between top and middle management, but also among management and individuals responsible for daily business operations.

Global procurement

We will accelerate global procurement activities by working with worldwide production sites. Previously, procurement activities were carried out mainly at individual production sites, but we have shifted to an approach with a greater global basis to obtain the most suitable parts at competitive prices. That benefits not only Suzuki, but also our business partners who can stably receive orders and accumulate various technologies. By sharing those merits, we can build relationships with even greater trust.

Business continuity plan efforts

In addition to seismic reinforcement of individual office buildings, we have produced a business continuity plan (BCP). We regard the preparation for earthquakes, tsunami and other wide-scale disasters as part of our responsibility to the local community, business partners, and customers. We recommend disaster measures such as seismic reinforcement to our partners located in areas that are likely to experience heavy damage. We are tackling such initiatives together with our business partners for their early recovery if they should fall victim to such a disaster.

Activities to support suppliers

We hold regular information exchange meetings with our local cooperating suppliers to share production plan forecasts and requests to reduce the impact on management caused by fluctuations in production volume. In addition, we conduct workshops on technical issues in collaboration with the Hamamatsu Agency for Innovation’s Next-generation Vehicle Center Hamamatsu with the aim of strengthening the competitiveness of the supply chain.

Awareness-raising activities for employees, suppliers

Each year, the Executive General Manager of the Procurement Strategy holds a briefing on procurement policy in the Procurement Policy Presentation for suppliers. During the briefing, suppliers are asked to understand based on the Suzuki CSR Guidelines for Suppliers the importance of human rights and environmental issues, and are requested to disseminate the guidelines through their own companies’ supply chains. In addition, for those in charge of procurement and suppliers we also hold workshops mainly related to foreign technical intern trainees and strive to share issues that should be addressed now and in the future.

Establishment of whistleblowing and consultation system

We have established a whistleblowing and consultation system that is available not only to employees and Group companies, but also to suppliers to obtain information on violations of laws or regulations in the supply chain, and to take corrective measures when problems are discovered. This whistleblowing and consultation system is posted together with the Suzuki CSR Guidelines for Suppliers on the information sharing system joining suppliers and Suzuki, and can be easily accessible for our suppliers.

Participation in outside associations, etc.

As a member of the Japan Automobile Manufacturers Association, Suzuki joins other manufacturers to take part in meetings such as the Supply Chain Committee to discuss issues such as strengthening supply chain infrastructure and improving competitiveness in the automobile industry. Currently, the participating companies are addressing issues such as trade optimization and achieving carbon neutrality, and these policies are reflected in Suzuki’s business activities.
Suzuki, with its procurement policies and measures related to them, is working from the standpoint of being a member of the Japan Automobile Manufacturers Association for the development of the industry, and in turn the resolution of social issues.