Supply Chain Management
Vision and Basic Policy
Suppliers of raw materials, parts, indirect materials, equipment, and subcontractors for product production and logistics are indispensable to our business activities. They are also partners in fulfilling social responsibilities. Based on this recognition, Maxell Group develops CSR activities in collaboration with our business partners and sincerely responds to the expectations and demands toward each of our business activities.
Key Initiatives
Three Pillars of Procurement Activities
Based on the MVVSS, which is our fundamental management policy, we have reorganized our procurement activities into three main pillars. While adapting to changes in the market, we will achieve results by co-creating with our partners to promote activities in line with this procurement policy.
Outline of Procurement Policy
Activities
Promoting Procurement Activities Linked to ROIC Management
We will advance procurement initiatives in collaboration with the Profit and Loss Improvement by Model Project (PIPJ) and the Profit and Loss Control by Business (ABC-XYZ Control). Specifically, as a measure to address and improve unprofitable products, we are strengthening cost planning engineering and global procurement activities. Furthermore, we are aiming to foster co-creation and prosperity by engaging in joint cost reduction activities with our partners and by welcoming their new proposals, such as unique technologies, advanced development, and new materials.
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Enhancing product competitiveness through material cost management
We will strengthen product competitiveness by managing material costs for each product category through budget versus actual analysis.
Specifically, by coordinating activities among corporate procurement, business division procurement, and related departments, we will implement measures towards our cost targets through integrating our partners' added value, improvements, and new ideas while forecasting and analyzing market trends. Additionally, we are dedicated to continuously pursuing operational efficiency by consolidating and centralizing the procurement of indirect materials and common items--previously acquired independently by business divisions--to the procurement headquarters.
Promotion of Sustainable Procurement
・Promotion of CSR Procurement
We are advancing supply chain CSR procurement activities based on the CSR Procurement Guidelines revised in 2020. Since June 2021, we have participated in the United Nations Global Compact's Supply Chain Subcommittee, striving for further improvement by referencing the activities of leading companies.
・Strengthening BCP (Business Continuity Planning)
With the increasing procurement risks such as natural disasters, rising raw material prices, and shortages of electronic components, we are enhancing our partners' BCP management. Since fiscal 2021, we have also been conducting BCP surveys at our overseas group companies.
・Enhancement of Compliance
We continue to implement legal compliance education internally and strive to ensure proper transactions with our partners.
・Endorsement of the "White Logistics" Movement
In Japan, the "White Logistics" movement began in 2019 to address the severe shortage of drivers in the transportation and logistics industry, with the aim of stabilizing logistics and contributing to the growth of the Japanese economy. Our company has endorsed and participated in this movement, viewing logistics improvement as one of the management challenges from the perspectives of sustainable growth, compliance, and ESG.
In addition to improving our current transportation methods, we are continuously working on reducing waiting times of drivers by aligning production and packing with shipping schedules, allowing flexible delivery times as shippers, and ensuring sufficient lead time to improve the working environment for drivers and the productivity of logistics. We will continue to promote the efficiency of the entire supply chain to fulfill our corporate social responsibility.
Promotion of CSR procurement
Policy
Maxell Group is committed to promoting CSR procurement throughout our supply chain, guided by our "Supply Chain CSR Procurement Guidelines." As CSR expectations evolve, we revised these guidelines in January 2020 to align with the SDGs. We encourage our suppliers to enhance their CSR activities, with key suppliers participating in self-assessments to further promote CSR procurement.
Management, Structure, and Systems
Maxell Group collaborates across the entire group to engage in CSR procurement in order to fulfill social responsibilities throughout the supply chain. The goals and activity plans are discussed by a cross-divisional "Procurement Risk Management Committee," which consists of members from the procurement departments of all business divisions and group companies, with the headquarters Procurement & SCM Division serving as the secretariat. This committee ensures that the initiatives are communicated and implemented across the entire group.
Procurement Risk Management Committee
Maxell Procurement & SCM Div.
Maxell Energy Div. Procurement Dept.
Maxell Functional Materials Div. rocurement Dept.
Maxell Optics & Systems Div. Procurement Dept.
Maxell Frontier Procurement Dept.
Maxell Izumi Procurement Dept.
Maxell Kureha Procurement Dept.
Ube Maxell Kyoto Procurement Dept.
CSR Self-Assessment (*1)
Since fiscal 2019, we have been using a CSR self assessment questionnaire to check the state of compliance with the CSR Procurement Guidelines at important suppliers in Japan and overseas, and are working to understand the current situation and make improvements.
The CSR self-assessment is conducted for critical suppliers (direct materials: accounting for 80% of procurement amount and parts suppliers with no alternative procurement; indirect materials: equipment-related suppliers) using a questionnaire developed by Maxell based on the on-site audit standards of the RBA (Responsible Business Alliance). This initiative is being carried out on a three-year cycle, and from fiscal 2022, the scope is being expanded to include equipment-related suppliers in addition to critical direct materials suppliers.
Based on the SAQ evaluation results, suppliers rated as D-grade undergo on-site inspections and receive support for improvement activities. Suppliers rated as C-grade are required to submit written improvement plans and are continuously followed up to ensure progress.
*The SAQ covers self-assessment items in the following areas: labour, health and safety, environment, ethics, quality and information security, and management systems.
Self-Assessment Evaluation Rank
Goal
To have all target suppliers achieve a B grade or higher by FY2027.
Performance
CSR Self-Assessment Results
Fiscal 2023 marks the second year of our three-year plan, and we received responses from 280 companies (240 direct materials companies, 40 equipment-related companies). In cases where the first-tier supplier is a trading company, we also asked for a response from the second-tier supplier. As for the evaluation results, no companies received a D grade, and 4% (10 companies) received a C grade (6 direct materials companies, 4 equipment-related companies). We are continuing to follow up on the improvement plans.
Self-Assessment Results List
(plan as of Sep 2024)
Responsible Procurement of Minerals
At Maxell, we have established a policy to engage in responsible procurement activities to ensure that we do not contribute to the activities of armed groups in conflict regions by sourcing materials that contain conflict minerals. We identify high-risk minerals such as tin, tantalum, tungsten, gold, and cobalt, which are sourced from conflict regions or areas suspected of engaging in anti-social or inhumane activities. We conduct and continue due diligence on these minerals in accordance with the "OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas."