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Procurement Policy

Sustainable Procurement

JFE Engineering views its customers and suppliers as key partners with whom it works hand in hand to cultivate close, trustworthy partnerships, and JFE Engineering is also dedicated to contributing to a sustainable world. From both perspectives, the company has established its own procurement philosophy and related requirements for business partners in the two following documents—the Basic Procurement Policy and Procurement Guidelines—both of which are based on the JFE Group Standards of Conduct and JFE Group Basic Policy on Human Rights. The company asks its business partners to adhere to these documents, and also to advance their corporate social responsibility (CSR) initiatives as well as promote sustainable procurement.

Basic Procurement Policy

  1. Compliance with applicable laws and social norms

    Understanding that compliance is fundamental to our procurement activities, we comply with all relevant laws and social norms, and act in good faith in our business dealings.

  2. Information management

    We properly manage all information obtained through transactions and other business.

  3. Fair competition

    Taking a broad view of the world and working from a global perspective, we provide ambitious and competitive companies worldwide with fair opportunities to serve as our business partners.

  4. Fair selection of business partners

    When selecting business partners, we base our decisions on economic rationality as well as our thorough evaluation of their quality, technologies, prices, delivery times, stable supply capabilities, reliability, management stability and commitment to CSR initiatives.

  5. Fostering trust

    Through sound business dealings, we seek to deepen understanding with our business partners and to establish mutually beneficial win-win relationships built on trust.  

  6. Caring for the environment

    In cooperation with our business partners, we seek green procurements with due consideration for environmental protection and environmental load reduction.

Procurement Guidelines

In addition to asking our business partners to understand and implement these guidelines, we also ask that their own suppliers be encouraged to do the same. In this way, we seek to promote these practices across our entire supply chain.

1.Compliance with applicable laws, regulations, social norms and corporate ethics

(1-1) Compliance with laws, regulations and social norms

1. We comply with all relevant laws, regulations and rules that apply to our business activities, including those concerning labor, the environment, construction, subcontracting, antitrust, public bidding and product safety, and we establish management systems and frameworks to facilitate such compliance.
2. We comply with all relevant laws and regulations in countries and regions where we do business, and we respect their local cultures and customs.

(1-2)Fair and equitable trade

1. When selecting suppliers, we comprehensively evaluate their quality, technology, price, delivery times, stable supply capabilities, reliability, management stability and commitment to corporate social responsibility (CSR), and we maintain high ethical standards and engage in sound, fair and equitable transactions.
2. With respect to our business partners and our competitors, we do not abuse superior bargaining positions, unfairly coordinate orders or rig bids, participate in cartels, or engage in any behavior that obstructs fair business dealings.
3. We do not engage in any practice that would impair bidding fairness, such as obtaining information that is potentially illegal, including undisclosed prices from customers.

(1-3)Prohibition of improper benefits

We prohibit employees from offering or receiving inappropriate benefits for the purpose of facilitating dealings with customers or other business partners, because we strive to form and maintain business relationships based on sound principles.

(1-4)Prohibition of corruption and bribery

We adhere to laws and regulations regarding entertaining or giving gifts, including to politicians and public officials of domestic or foreign governments.

(1-5)Avoidance of organized crime

We refuse to have any relationship with criminals or criminal groups, including organized crime groups, racketeers and extortionists, and we never respond to demands from such entities.

(1-6)Respect for intellectual property

We respect the intellectual property rights of third parties, including patents, copyrights and trademarks, and we do not obtain or use intellectual property improperly, nor do we infringe on such rights.

(1-7)Prevention of misconduct and protection of whistleblowers

We educate our employees on the prevention and early detection of misconduct. We also maintain systems that facilitate reporting on important issues, including human rights issues, and we protect the confidentiality and anonymity of whistleblowers.

(1-8)Prohibition of insider trading

We do not trade our own stock or any other company’s stock on the basis of material non-public information, nor do we disclose such information to other parties.

(1-9)Avoiding conflicts of interest

Our employees shall not engage in any course of action from which they or any third party may benefit at the expense of the company’s best interests.

(1-10)Appropriate import/export controls

We maintain clearly defined systems for managing the import and export of regulated technologies and goods, and we follow appropriate procedures in this regard.

(1-11)Responsible mineral procurement

Regarding certain minerals produced in conflict areas where human rights violations and other transgressions occur (including The Democratic Republic of the Congo and neighboring countries), which may be used to fund armed groups that carry out inhumane acts, we avoid using such minerals (tin, tantalum, tungsten and gold) in any of our products and take remedial steps if any such risk is identified.

2.Information security

(2-1)Defending against computer and network attacks

We protect against computer and network attacks and manage our computing and network resources so as to prevent both internal and external damage from occurring.

(2-2)Personal data and privacy protection

We appropriately manage and protect the personal information of our customers, third parties and our employees.

(2-3)Protection of confidential information

We appropriately manage and protect confidential information received from customers and other third parties to prevent unauthorized use and information leaks.

3.Quality and safety

(3-1)Providing safe, competitive products and services

1.We always ensure that the products and services we provide are safe and competitive in terms of quality, pricing and delivery, and we strive to provide new materials, technologies and engineering methods that offer high added value. To maintain and improve these qualities, we continuously work to develop technologies and improve our related capabilities.
2. We build and maintain quality management systems and continuously work to improve quality.

(3-2)Raw materials and parts traceability

To ensure product safety, we keep track of the histories of materials, parts, processes, etc. that we use, which helps us to address any related problem swiftly.

(3-3)Addressing defective products and related incidents

We maintain systems to respond properly if product incidents or defects occur, such as by disclosing necessary information, notifying authorities and other related parties, recalling products, and implementing remedial measures.

(3-4)Ensuring stable supply

To ensure we continue to supply products and services stably, we engage in business continuity planning (BCP) to prepare for possible emergencies including earthquakes and infectious disease outbreaks, and we ensure that our plans are thoroughly understood and implemented by all employees.

4.Human rights and labor

JFE Engineering is committed to implementing the JFE Group Basic Policy on Human Rights

(4-1) Respect for human rights and prohibition of discrimination

We respect basic human rights and we do not discriminate on the basis of race, nationality, gender, sexual orientation, age, disability, religion, ideology, ethnicity or other such characteristics when hiring or promoting people.

(4-2)Prohibition of forced labor

We ensure that employees are not being forced to work against their will, that employees are free to leave their jobs at any time, that employees are not forced to work under duress, and that employees are not forced to work overtime.

(4-3)Prohibition of child labor

We do not employ children under the legal working age in any country. We also do not allow any form of labor that could harm the health, safety, or moral integrity of children.

(4-4)Prohibition of inhumane treatment

We respect employees’ human rights and we ensure they are not subjected to any form of inhumane treatment, including abuse, corporal punishment or harassment.

(4-5)Appropriate wages

We comply with each country's minimum wage requirements, and we do not reduce wages unfairly.

(4-6)Management of working hours and holidays

We ensure working hours comply with relevant laws and regulations, and we manage employees’ working hours, holidays, and vacation time appropriately.

(4-7)Respect for freedom of association and the right to collective bargaining

We respect the right to freedom of association, unionization and protest, all without retaliation, intimidation or harassment.

(4-8)Management of employee health and safety

1. We establish systems to ensure the health and safety of employees, and we work to maintain and improve these systems.
2. We comply with laws and regulations related to occupational safety. We also maintain safe, clean working environments and endeavor to prevent occupational accidents and illnesses. When we provide cafeteria or dormitory facilities for employees, we ensure that the facilities are safe and hygienic.
3. We provide education and training to employees to ensure they have necessary safety-related information regarding work- related hazards that they may be exposed to.
4. We ensure that the health of all employees is properly managed through regular health checkups and the like, and we give due consideration to employees’ mental health.

(4-9)Health and safety guidance for subcontractors

When we hire subcontractors for construction work, we ensure that they comply with occupational safety laws, and we provide them with appropriate health and safety guidance.

(4-10)Management of third-party health and safety

We are committed to rigorous health and safety protocols to ensure that we do not endanger, interfere with or cause harm to the physical safety, health or property of any third party, including customers and local community residents.


(5-1)Chemical substance management

We monitor the chemical substances used in our products, and we manage those substances in accordance with relevant laws and regulations. We also confirm the volumes of chemical substances used in our manufacturing processes, based on which we strive to reduce their emissions and comply with all relevant laws and regulations, including our administrative reporting requirements.

(5-2)Reduction of wastewater, sludge and exhaust emissions

We set voluntary environmental impact-reduction targets at or above levels stipulated by relevant laws and regulations. We work to prevent pollution by monitoring and controlling noise and vibrations, wastewater, sludge, exhaust emissions and the like in order to reduce their impact.

(5-3)Sustainable, efficient use of resources

We set resource conservation goals, and we continuously strive to reduce our use of resources (water, energy, raw materials, etc.) as well as use resources more effectively.

(5-4)Reduction of greenhouse gas emissions

To address climate change, we set reduction targets for greenhouse gases such as carbon dioxide, methane and fluorocarbons, and we work to reduce their emissions.

(5-5)Disposal and recycling of waste

We set waste-reduction targets and strive to reduce our waste in accordance with these goals. We practice the three Rs (reduce, reuse and recycle) to reduce the amount of waste we generate.

(5-6)Biodiversity initiatives

We are mindful of the impact that our businesses can have on ecosystems, and accordingly strive to protect biodiversity and use resources in a sustainable manner.

(5-7)Environmental permits and reporting

Pursuant to relevant laws and regulations, we obtain all necessary licenses and registrations for our businesses. We ensure our businesses are operated appropriately and we meet our reporting obligations.

(5-8)Environmental management systems

We build, maintain and improve systems for environmental management.

6.Coexisting with local communities

(6-1)Collaborating with communities and contributing to development

We value collaborations with local communities and we engage in activities aimed at contributing to their development.

(6-2)Information disclosure

To ensure transparency, we provide our stakeholders with accurate information that is useful for assessing the management of our operations, finances, environmental protection initiatives and social contributions. We also facilitate communication with society at large.

These procurement guidelines have been established with reference to guidelines set out by the Global Compact Network Japan (GCNJ). To understand how our business partners address these guidelines, we may seek information from them through questionnaires based on GCNJ assessment tools or by visiting our partners' facilities to conduct interviews.

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