As a manufacturer, the Group's lifeline lies in its supply chain. In order to make it sustainable and strong, we will transform it into a robust materials purchasing system that can respond to rapid changes in the market, society, and the environment, while ensuring co-existence and mutual prosperity with our suppliers. We will also address various social
imperatives, such as the reduction of GHG (greenhouse gas) emissions in Scope 3, the management of chemical substances, and respect for human rights.
TOKYO KEIKI Group Sustainable Materials Procurement Policy
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In procuring materials, we will, on the premise of conducting fair
transactions, make selections in good faith based on a fair and
comprehensive evaluation of basic evaluation criteria such as quality,
price, delivery time, and environmental considerations, as well as
sustainability of business activities and attitude toward ongoing
improvement.
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In conducting transactions, we will comply with social norms and related
laws and regulations, and appropriately manage information obtained
through such transactions. In addition, we will ensure that confidential
information is not leaked.
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In conducting transactions, we respect the vision and position of our
suppliers as partners in manufacturing, and by building relationships of
trust from a medium- to long- term perspective, we aim to strengthen our
competitiveness through mutual prosperity with these partners.
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In order to ensure the trust of customers and the market by maintaining
the quality of procured parts and materials, we will establish a
sustainable quality management system in cooperation with our business
partners.
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In conducting transactions, we will promote material procurement
activities that take into consideration health and safety, the working
environment, and human rights in the supply chain.
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In procuring materials, we will strive, alongside our business partners,
to protect the environment in accordance with our environmental policy and
promote green procurement activities, including reduction of GHG emissions
and harmful chemical substances, in consideration of the global
environment.
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In preparation for disasters and unforeseen circumstances, we will work
with our business partners to establish a BCP system for maintaining
employee safety and continuity of corporate activities in the supply
chain, and take appropriate measures.
Supply chain management system
Our Group’s supply chain management system comprises the Material
Management & Purchasing Office, the Headquarters’ administrative
divisions; and the purchasing divisions of each internal company.
As an organization under the direct control of the President, the Material
Management & Purchasing Office supports each internal company’s purchasing activities.
The Material Management & Purchasing Office engages
in administrative tasks such as maintaining and managing basic companywide
policies, the Standard Purchasing Rules, and the template of Purchase Agreement used by our Group.
The office also provides companywide guidance on the Act against Delay in Payment of Subcontract Proceeds, etc. to
Subcontractors (Subcontract Act); supervises purchasing and procurement;
maintains and manages our core information system (TBB system); manages
credit based on supplier management information; and supports the activities of cooperatives and partner association suppliers.
In addition, the Office is in charge of procuring materials for product development in the Headquarters District.
Each internal company’s purchasing division primarily
purchases the production materials necessary for that company’s
production activities, engaging in efficient, fair, and equitable transactions
with our suppliers in Japan and overseas. When initiating a transaction, it is
standard practice to conclude a Purchase Agreement. Actual purchasing is
conducted using our TBB system, ensuring that the transaction is in accordance with the Standard Purchasing Rules.
Supply chain management system
Initiatives to enhance the skills of purchasing personnel
Capability development of purchasing personnel is led by the Materials Management & Purchasing Office; based on the training plan provided by the office, staff members participate in seminars such as "Collaboration with Related Internal Departments," "Strengthening Negotiation Skills with Suppliers," and "Current Status and Future Outlook for Supply Chain Management." The Material Management & Purchasing Office also urges purchasing personnel to take a seminar on the Subcontract Act, and in fiscal 2024, 30 people took part in the seminar.
Quality improvement initiatives
Quality audits are based on each internal company's quality management system and are conducted at the start of transactions, on a regular basis, and on other occasions as deemed appropriate. The scale of our Group's suppliers is varied. Many of our machined component suppliers, in particular, are small in scale, and with them we value face-to-face dialogue with purchasers. By placing importance on direct communication, we can better understand a supplier's working conditions and quality management, while also helping to build long-term trusting relationships with suppliers.
Green partner initiative
The Green Partner System is an initiative to eliminate hazardous
substances from production processes throughout the supply chain in order to
encourage environmentally friendly manufacturing. TOKYO KEIKI is putting this
system into practice alongside our suppliers.
Under this initiative, suppliers
who meet our management standards and have the ability to conduct independent
quality management to prevent hazardous substances being used in or
contaminating their production lines are certified as Green Partners. This
eliminates the need to submit a non-inclusion certificate for each product or
part and to conduct some of the tests on the chemical substances they contain.
We also provide various services to Green Partners, such as support for the
testing and analysis of chemical substances contained in parts and materials,
provision of environment- related information, and support for
environment-related education.
Calculating Scope 3 GHG emissions
In order to understand supply chain GHG emissions across all of supply chains, we calculated the total emissions of all of our supply chains based on the Basic Guidelines on
Accounting for Greenhouse Gas Emissions Throughout the Supply Chain from the Ministry of the Environment.
The breakdown of Scope 3 emissions is shown in the
table below. Category 1 (purchased goods and services) accounted for the largest percentage at 60.7% of total emissions, followed by Category 11 (use of sold products) at 27.0%. It should be noted that current calculations are based on the Ministry of the Environment's emission unit values database (secondary data); although this is effective for understanding the overview, it will be necessary to gain more details of the actual conditions of these categories in order to actually achieve reduced emissions.
We plan to set a Scope 3 reduction target during fiscal 2025 and are working with suppliers and other partners to collect actual (primary) data.
*1: Not applicable (emissions from leased assets included in Scope 1 and
2).
*2: Not applicable (finished product logistics outsourced and thus
included in category 4).
*3: Not applicable (as TOKYO KEIKI’s products are finished products, they
are not processed after sale).
*4: Not applicable (no relevant leased assets).
*5: Not applicable (no relevant franchises).
*6: Not applicable (no relevant investments).
Calculation method: Based on the Basic Guidelines on Accounting for
Greenhouse Gas Emissions Throughout the Supply Chain from the Ministry of
the Environment and the Ministry of Economy, Trade and Industry.
Calculation period: April 1, 2024–March 31, 2025
Calculation scope: TOKYO KEIKI (non-consolidated)
Partnership Building Declaration
We announced our "Partnership Building Declaration" in April 2023. Based on this declaration, we aim to enhance added value throughout the entire supply chain, and to build a framework of mutual prosperity with suppliers through cooperation that transcends existing business relationships and company size, etc. We also comply with the "Standards for Promotion" under the Act on the Promotion of Subcontracting Small and Medium-sized Enterprises and actively work on rectifying any business and commercial practices that hinder partnership building with suppliers. By establishing an environment in which suppliers can grow as our partners, we aim to achieve a virtuous cycle whereby suppliers can secure stable management, and in addition, where the foundation of our supply chain is strengthened even further.
Partnership Building Declaration
https://www.biz-partnership.jp/declaration/28872-05-21-tokyo.pdf
(Only in Japanese)
Formulation of sustainable materials procurement policy
In addition to our existing requirements for materials procurement, we have formulated the TOKYO KEIKI Group Sustainable Materials Procurement Policy to declare our commitment as a company to building sustainable relationships with our suppliers and to procuring materials responsibly with regard to social issues such as human rights protection and conservation of the environment.
Strengthening collaborations with suppliers also enables us to meet the sustainable procurement requirements of globally operating customers and represents an essential strategy for enhancing trust in our company and sustainably improving our corporate value.
Sustainable Materials Procurement Policy
https://www.tokyokeiki.jp/company/sustainable_procurement.html
(Only in Japanese)