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Supply Chain Management

Responsible Minerals Procurement

Responsible Minerals Procurement

Policy to address conflict minerals

Since 2013, the OMRON Group has been engaged in conflict mineral surveys to contribute to a better society. We have established a policy to refuse mineral resources (3TG) mined in the Democratic Republic of the Congo and nine surrounding countries that have continued to violate human rights and damage the environment.

Policy to address conflict minerals

  1. The OMRON Group declares the non-use of such conflict minerals.
  2. The OMRON Group procures minerals from conflict-free smelters, such as those participating in the Responsible Material Initiative (RMI).
  3. Should the use of any conflict minerals in OMRON Group products be discovered, OMRON will take corrective action as quickly as possible.

Framework to address conflict minerals

Since fiscal 2013, the issue of conflict minerals has been specified as one of main themes to be deliberated upon and addressed by the Corporate Ethics and Risk Management Committee, which is in charge of devising and promoting counteraction against the OMRON Group’s significant risks. As such, the Committee reports the status of conflict mineral use to the Board of Directors and Executive Council every half year.In fiscal 2013, ORMON set up the Anti-Conflict Minerals Project to formulate an annual action plan based on the review of results of the previous year’s activities, managing the progress of plan implementations for each supplier and each parts/material category on a monthly basis.

Framework to address conflict minerals

Survey of conflict mineral use

OMRON has been conducting surveys by using CMRT (Conflict Minerals Reporting Template), the industry standard developed by RMI (Responsible Minerals Initiatives), tracking upstream supply chain.
This survey is based on OECD guidelines for due diligence in risk survey processes. More specifically, we conducted the following steps:

Step 1:Build a Management System
Based on the OMRON Responsible Minerals Procurement policy, we organize group-wide projects to share and implement necessary surveys. We build and use information systems to track and manage survey results, supporting the creation of responses to our customers.
Step 2:Identify and Evaluate Supply Chain Risks
Every year, we identify parts purchased at our plants requiring a survey, conducting a conflict materials survey with our suppliers using CMRT. Through these surveys, we conduct due diligence on the presence of 3TG, country of origin, smelters, and suppliers. In addition, we identify non-certified smelters based on the latest RMI-certified smelter list.
Step 3:Develop and Implement Strategies to Address the Risks Identified
We seek require suppliers to take corrective action for any non-certified smelters identified in our risk evaluation process. If a customer raises concerns, we confirm the basis of the concern, communicate the customer concern to our supplier, and seek an appropriate response, including a re-examination of the smelter in question by our supplier. At the same time, we educate our suppliers for a better understanding of conflict mineral regulations.
Step 4:Annual Activity Report
We publish an annual report on our website concerning our conflict mineral survey and other OMRON initiatives related to conflict minerals.

Initiatives

In fiscal 2019, OMRON examined materials purchased by the OMRON Group over the past two years.

  • Survey targets: 303 suppliers
  • Respondents: 283 suppliers (response rate: 93%)
  • Identified smelters: 503, all minerals (of which 269 certified as RMI conflict free smelters)
    OMRON will continue sending the survey to non-respondents* in fiscal 2020.

Through monthly management of survey responses, OMRON checked with suppliers who hadn’t responded yet, asking for their progress in order to help raise the response rate. The responses were examined thoroughly, and in any case of missing or inadequate answers, OMRON communicated with such suppliers to improve the reliability of responses.

To date, there has been no discovery of usage of conflict minerals for which any association with armed rebel groups is suspected. Should the use of any conflict minerals in OMRON Group products be discovered, OMRON will take corrective action as quickly as possible.

Cobalt procurement

Cobalt is used in lithium-ion batteries that are indispensable for electronic vehicles, mobile phones among other products. The Democratic Republic of Congo is the largest cobalt producer in the world, and there is a concern pointed out about manual mining in the country with poor working conditions and child labor.
OMRON has a basic policy in its Sustainable Procurement Guidelines that bans any forms of forced and child labor, and promotes cobalt procurement in a manner not to drive environment destruction and human rights violation.
During fiscal 2019, we used the RMI (Responsible Minerals Initiative) Cobalt Reporting Template as a trial survey for lithium ion secondary batteries, which have come under scrutiny around the world.

Initiatives

  • Surveyed Suppliers: 7 companies
  • Responding Suppliers: 7 companies (100% response)

Briefing surveys on conflict minerals use to suppliers

Since fiscal 2013, OMRON has been organizing a meeting with its suppliers to brief them on the surveys on use of conflict minerals. In fiscal 2014, OMRON held a meeting with suppliers seven times in Kyoto and Kyushu, drawing some 240 suppliers. Since fiscal 2015, OMRON holds one-on-one briefings with suppliers whom OMRON newly asks for the cooperation in the survey.

Partnerships with industry organizations

In April 2011, OMRON joined the Responsible Minerals Trade Working Group organized by the Japan Electronics and Information Technology Industries Association (JEITA), actively collecting information and promoting partnerships with industry organizations. Since fiscal 2015, OMRON participates in the planning and management of conflict mineral investigation conference meeting hosted by the Working Group to promote dissemination of conflict minerals efforts across supply chains of the industry as a whole.


Conference hosted by Responsible Minerals Trade Working Group (held on June 13, 2019 in Osaka)
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