Supply Chain

To remain committed to Our Proactive Impact to Realize the Regenerative Society, in conducting business activities based on FSG Code of Ethics, we have established Requests for FSG Business Partners, and ask our business partners to understand, agree with, and comply with the purpose of the Course of Action. Based on fairness and justice, we will achieve responsible production patterns through mutual trust and study, and generate Waku-Waku with our business partners.

• Group Purchasing Policy

We have compiled more specific standards based on "FSG Code of Ethics" and "FSG Business Partners" in the "FSG Sustainable Supply Chain Guidebook", which we share with our business partners to promote sustainability activities together. To ensure that our business partners also fulfill their social responsibilities, we ask them to agree with our "FSG Business Partners" in our basic trade agreements. We conduct a "FSG Sustainable Supply Chain Questionnaire" with our Business Partners once a year to better understand their actions and to support the implementation of this Guidebook according to their needs. We also conduct regular on-site and online audits to ensure responsible production practices through more intensive communication.

"Risks" and "opportunities" in corporate management are changing at an accelerated pace.

As the entire world strives to achieve the SDGs it is no longer about short-term profits, conducting business activities without considering the ESG perspective is a "risk" to the future of a company's sustainability.

On the other hand, when companies address ESG and SDGs through their business practices, it can be a major "opportunity" to strengthen their viability and capture untapped markets.

We believe it is important for FSG's procurement staffs to understand the concept and background in order to promote activities throughout the supply chain, and as an initiative for 2021, we remotely conducted Lecture based on our Sustainable Supply Chain Guidebook which is taken from all our main business locations (Japan, the Americas, Europe, and ASEAN countries) Totally 117 people participated. (100% participation by our procurement staffs)

• Sustainable Supply Chain Guidebook

One of our Materiality in Fair and Transparent Transactions, FSG places an emphasis on performing transactions with customers and business partners without anxiety. We consider it is important to realize fair and transparent transactions with respect to not only prices but also quality management system and quality warranty system, together with experience, past performance, social factors and other matters selected comprehensively.

In order to understand whether our business partners agree with our policies and initiatives related to ESG, and to assess risks and resolve issues, we began conducting the Sustainable Supply Chain Survey in FY2020. In FY2020, we began with 10 companies, and in FY2023, we received responses to our policy has been endorsed by 90% of our suppliers, who account for 90% of the total value of our purchases of main raw materials.

If issues are identified in the "Sustainable Supply Chain Questionnaire", rather than immediately suspending or terminating transactions, we will conduct a written audit or on-site audit, and we believe that working together with our business partners to improve these issues will lead to the resolution of social challenges.

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The Fuji Seal Group Sustainable Supply Chain Questionnaire consists of 12 major items which are considered important for sustainability, beginning with the "Agreement with request to business partners", including items such as Sustainability system, Legal compliance, Human rights, Occupational health and safety, and items related to the Environment.

• Materiality Initiatives (Integrated Report)