Foundation Underpinning ESG Management

At SEKISUI CHEMICAL Group, we consider it our duty to advocate for the human rights of all people affected by our business activities.
Nowadays, the enaction of rules and laws related to human rights continues to progress both inside and outside of Japan, and human rights issues are getting increasing attention in society. In these conditions, we consider human rights initiatives for not only employees of the Group, but also our business partners and other stakeholders to be essential for solidifying our sustainable management platform. When conducting human rights due diligence, including the identification of human rights issues, we will apply expert human rights knowledge from independent third parties and engage in earnest dialogue and consultation with our stakeholders.

SEKISUI CHEMICAL Group formulated the SEKISUI CHEMICAL Group Human Rights Policy in May 2019. This policy is consistent with the Guiding Principles on Business and Human Rights adopted by the United Nations Human Rights Council and is distinguished by its commitment to firmly respecting human rights across the board, including the value chain beyond the Group.
The scope of human rights due diligence and education initiatives stipulated in the policy was expanded in fiscal 2021. Going forward, we will continue to work toward achieving an understanding of and instill this Human Rights Policy among all employees of the Group, as well as our suppliers and business partners.
See the following for details of the SEKISUI CHEMICAL Group Human Rights Policy.

SEKISUI CHEMICAL Group discloses a statement, adopted by its Board of Directors, regarding its efforts to prevent any form of modern slavery or human trafficking in any part of the Group’s business or within its supply chains, in accordance with section 54 (1) of the UK Modern Slavery Act, which came into force in the UK in 2015.
SEKISUI CHEMICAL Group will also take appropriate measures to comply with human rights laws and regulations in countries and regions other than the UK that are relevant to its operations.

UK Modern Slavery Statement (Download PDF)

In endorsing the My Declaration of Human Rights Project put forward by Japan’s Ministry of Justice, SEKISUI CHEMICAL Group announced details of its declaration in September 2021.
This project is an initiative that encourages companies, organization, and individuals to declare their intention to behave in a manner that promotes mutual respect thereby ensuring the human rights of every member of society.
SEKISUI CHEMICAL Group’s human rights declaration is as follows.
SEKISUI CHEMICAL Group’s long-term vision is to support the basis of LIFE (existence, life, lifelines) and create peace of mind for the future. In order to contribute to the realization of a sustainable society, we will respect the human rights of all people affected by the Group and establish a framework to prevent and mitigate human rights violations on a global basis.

SEKISUI CHEMICAL Group launched initiatives aimed at building a human rights due diligence framework in November 2018. Initiatives implemented up to fiscal 2020 are as follows.

In light of frequent comments from Japan and overseas regarding the high level of human rights risk in Japan related to the general labor environment for foreign nationality employees, employee interviews were conducted to confirm the working environment at the following domestic production sites, which have a relatively large number of foreign nationality employees, in December 2020.

In fiscal 2021, SEKISUI CHEMICAL Group conducted human rights risk assessments of Group companies, including joint ventures, on a global basis.

Although the results of the assessment did not reveal any human rights issues requiring a critical or immediate response within the scope of the survey, priority human rights issues that were identified as requiring further review included working conditions for foreign nationality employees, fair wages, respect for religious practices, and inequalities in hiring and promotion.

For each site where the above issues were identified, we will confirm the status of each situation on an individual basis and take corrective actions as necessary.
In addition, the following were identified as issues that require stronger Group-wide management in order to prevent the emergence of human rights risks

To address these Group-wide issues in a cross-organizational manner, we established the Human Rights Subcommittee, which is chaired by the Director and General Manager of the Human Resources Department and comprises the heads of each specialized headquarters department.

In order for our suppliers to understand the Group’s procurement policy, including respect for human rights, we have produced English and Chinese translated versions as well as the Japanese version and are promoting the process of making procurement policies available in a variety of languages, such as by posting them in Japanese and English on our websites.
Until now, we have conducted CSR procurement surveys of our direct suppliers. To ensure that the Group’s policies are understood throughout the entire supply chain, including secondary and tertiary suppliers, we formulated the SEKISUI CHEMICAL Group Sustainable Procurement Guidelines (Supplier Code of Conduct) in fiscal 2021. Taking into account opinions of outside experts, our procurement guidelines are also in line with the United Nations Global Compact 10 Principles, the Guiding Principles on Business and Human Rights, and the SEKISUI CHEMICAL Group Human Rights Policy. In addition to asking suppliers to extend this Code of Conduct to their secondary and tertiary suppliers, we have requested that suppliers sign on to acknowledge compliance with the guidelines. In this regard, we have obtained the agreement of approximately 61% of our key suppliers in Japan and overseas to work with us to achieve the Code of Conduct.

Guided by its procurement policy, SEKISUI CHEMICAL Group looks to ascertain the status of our suppliers’ human rights considerations as well as environmental conservation and social responsibility initiatives through surveys.
Although we have conducted surveys at SEKISUI CHEMICAL and Group companies as well as in each overseas region up until now, we changed to a general global survey from fiscal 2021 in order to more rapidly address common global initiatives.
We formulated sustainable procurement guidelines that cover the UN Global Compact 10 Principles in order to enhance sustainable procurement in fiscal 2021. Surveys conducted were significantly revised to allow suppliers to evaluate and confirm their own compliance and achievement of the guidelines. In substantially increasing the number of questions and making it more difficult to reply, 336 of the 499 domestic and overseas companies surveyed responded in fiscal 2021.

SEKISUI CHEMICAL Group engaged in individual dialogue^* with overseas experts in October 2021, speaking with specialists in human rights from the Institute for Human Rights and Business (IHRB) and the United Nations Development Programme (UNDP) about the Group’s human rights initiatives. Discussions included advice on how the Company could best develop its related activities moving forward.
While commenting favorably on the human rights risk assessments conducted for foreign nationality employees in Japan this fiscal year as an effective initiative, experts pointed out the importance of conducting surveys targeting overseas Group immigrant workers and the need to ascertain whether human rights have been violated.
Looking ahead, we will continue to promote human rights initiatives on a systemic basis in accordance with the Guiding Principles on Business and Human Rights while drawing on the opinions of these stakeholders.

SEKISUI CHEMICAL Group conducts training and educational programs focusing on the theme of human rights for its employees. In this manner, the Group is endeavoring to engage in management that takes into consideration concerns regarding human rights. Training, especially at such milestones as when an employee enters the Company or is promoted, is designed to raise awareness of human rights issues including forced labor, child labor, and harassment.
In order to prevent power, sexual, maternity, and other forms of harassment, SEKISUI CHEMICAL Group continues to address harassment-related topics during employee rank-based training, including new employee and newly appointed manager training. In this way, we provide knowledge for preventing harassment tailored to each rank and position. In addition to periodically providing harassment training as part of field-based educational programs, we also implement such initiatives as e-learning. In fiscal 2021, 1,383 employees participated in harassment training.

Moreover, as part of our human rights education for employees in Japan and overseas, we began our Business and Human Rights e-Learning course in Japanese and English, which is available on the Company intranet, from fiscal 2020. In fiscal 2021, the decision was made to expand this initiative to all areas (North America, Europe, and Asia) in which the Group operates.
Currently, we are promoting efforts to provide education in German, Spanish, Dutch, Chinese, Thai, and Indonesian.
Through these training and education means, we are advancing awareness toward the importance of and need to respect human rights as well as our human rights policy.
Over and above the aforementioned, the compliance manual for domestic Group companies and the global compliance manual for overseas Group companies, which are provided to all Group employees, contain information on a wide range of topics including respecting human rights, prohibiting discrimination, preventing harassment, and protecting personal information. In this manner, we work diligently to promote understanding of a broad spectrum of human rights and compliance issues.

SEKISUI CHEMICAL has been concerned about the issue of conflict minerals in the Democratic Republic of Congo and neighboring countries and has conducted surveys on the use of conflict minerals throughout the supply chain from a CSR perspective.
However, in light of recent events, we reviewed our Conflict Minerals Survey Guidelines that have been in effect since April 2017 and began applying new Responsible Mineral Procurement Survey Guidelines. From fiscal 2021, we have conducted surveys that include cobalt and mica in Japan. In addition to conventional sources for the funding of armed forces, we will identify smelters and respond in accordance with risk levels in order to eliminate the procurement of minerals related to such risks as child labor and other human rights abuses.
Through a tin, tantalum, tungsten or gold (3TG) survey, SEKISUI CHEMICAL Group identified that 98% of smelters and refineries in Japan and 99% overseas were Conformant (have passed or are undergoing Responsible Minerals Initiative (RMI) audits). While identifying 83% of domestic cobalt smelters, we are yet to identify any mica processors. We will strengthen our activities from the next fiscal year both in Japan and overseas.