We endeavor to conduct transactions fairly in accordance with applicable laws and regulations, while ensuring trust-based relationships with our suppliers and pursuing mutual benefits.
The Fuji Electric Purchasing Policy clearly defines “Fair Trade” as the company’s action guideline for procurement. Accordingly, we seek domestic and overseas suppliers that offer highly competitive quality, prices, delivery and services and pay due attention to their corporate social responsibilities.
We also promote mutual understanding by building sound partnerships through transactions conducted on equal terms with suppliers selected through free competition.
Staff training in procurement-related laws and regulations
Each year, Fuji Electric carries out internal audits and staff training regarding procurement laws and regulations.
Japan’s Subcontract Act* is an important procurement-related ordinance, and since 2005 we have conducted annual internal audits to monitor responses to Subcontract Act Internal Compliance Audits at our company and our consolidated subsidiaries. These audits are carried out through mutual checking by corporate auditors from each Fuji Electric company. Internal Compliance Audits were conducted at eight business sites in FY2010. These audits highlighted a total of seven issues, which were corrected.
Our educational activities target employees in the procurement divisions of our company and our affiliates, providing training concerning the Subcontract Act and other procurement-related laws and regulations. During FY2010, we carried out 16 such training sessions for 360 employees, covering such topics as the Subcontract Act, the Stamp Duty Act, response to supplier bankruptcies, and basic transaction agreements.
* Formally, the Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors. The purpose of this act is, by preventing delays in payment of subcontract proceeds, to ensure that transactions are fair and protect subcontractors’ interests.
Fuji Electric’s basic policy is to select suppliers through free competition, regardless of their origin. We respond to all inquiries with sincerity, promptly dispatching any necessary information and opening our doors to new potential suppliers.
When selecting new suppliers, we carry out comprehensive investigations of such factors as quality, price, lead times, supply stability and environmental considerations. We also reassess our existing suppliers each year, providing guidance and urging improvements in areas that fall below our exacting standards.
Fuji Electric includes many CSR items in our purchasing policy, so as to offer useful products and services and increase the trust granted us by our stakeholders and society. We also work with our suppliers to promote CSR activities.
In FY2010, we conducted a questionnaire-based survey of our top 450 suppliers on their CSR activities, receiving responses from 90%. We notified suppliers deemed to “need improvement” of the categories requiring improvement and provided advice on measures to do so.
We also conducted 10 CSR surveys of overseas suppliers on a trial basis, and no problems were found. In FY2011, we plan to expand these surveys, focusing on China and Southeast Asia, where business is expanding.
Fuji Electric is committed to eliminating anti-social forces. In recent years, the methods such entities employ to solicit funds have become increasingly sophisticated. The Japanese government announced guidelines to counter this trend in June 2007. We have Memorandums for the Exclusion of Antisocial Forces in place with the majority of our suppliers so as to reinforce our position on damage limitation. In addition, we always respond honestly to requests from customers to sign such agreements.
We established the Fuji Electric Green Procurement Guideline in 1998 to encourage the sourcing of environmentally friendly materials and parts, and we actively promote green procurement.
We ask our suppliers create chemical substance management structures to ensure appropriate controls across our supply chain, particularly on the chemicals contained in materials and parts. In addition to distributing survey forms concerning the existence of structures for managing the chemical substances contained in products, we request that such structures be compliant with the JAMP/JGPSSI Guidelines for the Management of Chemical Substances Contained in Products.
In FY2010, we conducted a survey concerning the presence of substances covered by the REACH rules.
Fuji Electric contracts locally with specialist companies for construction of geothermal, thermal and other power generation facilities, but we retain control of worker safety during operations.
For example, we routinely conduct Danger Prediction Meetings to confirm safety items for each type of work, as well as checking safety systems, conducting safety patrols, and similar activities.
We form safety and health committees with construction companies on large projects, and regularly produce and distribute health and safety-related information, issue health and safety reports, and conduct special training concerning dangerous work, such as oxygen-deficiency or hydrogen sulfide danger.
There were no labor accidents at our project sites in FY2010.