Responsible Supply Chains

Because Panasonic Group believes that “a company is a public entity of society”, we engage in fair and equitable transactions with our global suppliers. With a need for a more stringent sense of moderation and ethics and to maintain healthy relationships with suppliers, in 2004, we released our Clean Procurement Declaration and have followed this declaration in our procurement activities since.

In Japan, we promote understanding and awareness of “clean procurement” among our procurement staff by providing annual e-Learning and training materials.

The Group established “Rules on Gift and Hospitality for Anti-Bribery / Anti-Corruption” in its internal regulations, applied at the global level. These strict rules apply to the acceptance of gifts, meals, entertainment and travel invitations from our business partners, including suppliers. They stipulate general rules regarding the rationality and balance in light of the purpose, value and frequency of gifts, meals, entertainment and travel invitations, and local customs, and the absence of improper influence on business judgement. More detailed standards and stricter rules are also set for each region.

We, the Panasonic Group, require that suppliers affirm the Panasonic Group’s Code of Ethics & Compliance and the Panasonic Group’s Human Rights and Labor Policy, and at the start of transactions for materials and components for the manufacturing of Panasonic products, we make it mandatory to conclude a Master Global Purchasing Agreement that stipulates compliance with the CSR Guidelines. In addition, we stipulate in the CSR Guidelines a respect for human rights as expressed in United Nations norms and principles, an evaluation of the status of suppliers’ human rights initiatives and the implementation of prevention / mitigation / corrective measures, a request for compliance with tier 2 suppliers, and a request for cooperation with the Panasonic Group’s human rights due diligence. The template of our Master Global Purchasing Agreement obliges suppliers to comply with the CSR Guidelines. In addition, to obtain commitments from all our suppliers, we have been asking our suppliers to submit written consent to comply with the CSR Guidelines since revising them in December 2022.

To promote human rights due diligence and other aspects of CSR throughout the supply chain, the Group requires its suppliers to conduct CSR Self-Assessments.

The CSR Self-Assessments are structured based on the CSR Guidelines, and we require that all new suppliers conduct the assessments before we start transactions with them. We also require our existing suppliers to conduct them regularly.

We collect these assessment results using a web-based questionnaire, reducing the burden on suppliers and our Group and improving collection efficiency and accuracy.
As of March 31, 2024, we had collected the questionnaires from more than 12,300 suppliers (95%). After identifying issues, particularly those identified as priority management items in the CSR Self-Assessments, such as labor conditions for migrant workers, we will visit suppliers, check on-site conditions, hold interviews, and investigate issues if necessary and work to correct them. We will continue to collect these assessments from our suppliers on a regular basis.

Since April 2022, the Group has begun work on initiatives to build a structure for human rights due diligence. While incorporating guidance from outside experts, the Group has compiled a table to assess human rights risks at our suppliers by using risk indicators and indices provided by international organizations in order to identify suppliers for which action should be taken on a priority basis.

Since April 2023, all operating companies narrowed down the audit targets from among these identified suppliers based on the aforementioned risk approach and conducted supplier audits for a total of 141 suppliers (16 of which were audited by third-party organizations) using the supplier audit plans they formulated.

The items identified through audits are shown in the table below. We have asked suppliers to improve these items, and we are monitoring their progress.

With the PHD Executive Officer in charge of procurement assuming ultimate responsibility, we are working to build a Groupwide management system for responsible minerals procurement in collaboration with each operating company.

Responsible mineral survey requires cooperation from all our suppliers going back to the refineries and smelters.Panasonic Group uses industry-standard survey forms issued by RMI to conduct surveys, including the tin-tantalum tungsten-gold (3TG) survey form (CMRT) and the cobalt-mica survey form (EMRT).

The Panasonic Group conducts surveys regarding responsible minerals on the suppliers of each operating company and business site. In fiscal 2024, we collected responses from 2,850 of 3,041 suppliers that we asked to conduct CMRT surveys and 3,474 of 3,711 suppliers that we asked to conduct EMRT surveys (as of March 31, 2024). Based on the data collected from the survey forms, we conducted a risk analysis and assessment and requested further investigations from suppliers, according to the risks that we identified.

In fiscal 2024, roughly 60% of the designated refiners and smelters had Conformant/Active Smelter status (refiners and smelters that have either passed RMI audit or is currently undergoing one). We are also working on industry efforts that will push the remaining 40% of those refiners and smelters toward participation in the Responsible Minerals Assurance Process (RMAP). In the rare event that we find minerals that are complicit in conflicts or human rights violations in our supply chain, we also ask suppliers to take steps toward no longer using them, including changing their source.

Panasonic Group is participating in JEITA’s Responsible Minerals Procurement Working Group to raise supply chain awareness and improve the efficiency of surveys through industry collaboration. More specifically, we have been working with industry groups both inside and outside Japan and holding seminars and surveys briefing sessions to promote best practices regarding responsible minerals. We have also worked on smelters/refiners information scrutiny. We have been working in JEITA’s Working Group and continue to encourage smelters to participate in the Responsible Mineral Assurance Process (RMAP) with other member companies. Furthermore, we joined the Responsible Minerals Initiative (RMI) in July 2017, with the aim of learning about the latest industry trends and promoting best practices for procurement activities. Panasonic Group will continue to conduct responsible minerals surveys while monitoring industry trends.