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 our social responsibilities. Based on this recognition, Maxell Group will develop CSR activities in collaboration with our business partners and sincerely respond to the expectations and demands towards each business activity.
Procurement Policy
Key Initiatives in the "Three Pillars of Procurement Activities"
Based on the MVVSS, which is the fundamental management policy of our company, we have reorganized our procurement activities into three main pillars. While adapting to changes in the market, we will achieve results by collaborating with our partners to promote activities in line with this procurement policy.
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 aim to foster mutual 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.
Enhancing product competitiveness through material cost management
We will strengthen product competitiveness by managing material costs for each product field through budget versus actual analysis.
Specifically, by coordinating activities among corporate procurement, business unit procurement, and related departments, we will integrate our partners' added value, improvements, and new ideas while forecasting and analyzing market trends to meet cost targets. 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 devices, we are enhancing our partners' BCP management. Since FY2021, 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 for shipments by aligning production and packing, 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
Management, Structure, and System
Maxell is actively collaborating across the entire group on "CSR procurement" to fulfill our social responsibilities throughout the supply chain. The goals and action plans are discussed and determined by the "Procurement Risk Management Committee", a cross-group entity comprising representatives from all business divisions and the procurement departments of group companies, with the headquarters' procurement SCM department acting as the secretariat. These plans are then communicated and thoroughly implemented across the entire group.
Activities
At Maxell, we promote CSR procurement across the entire supply chain based on the "Supply Chain CSR Procurement Guidelines." The demands for CSR from corporations are constantly changing, and to address this, we revised our guidelines in January 2020 to be centered around contributing to the SDGs. We have always asked our partners to promote CSR activities, but we are making further efforts to promote CSR procurement activities by asking key partners to cooperate with self-assessments of their CSR activities.
Goals
Since FY2019, we have been assessing the implementation status of CSR procurement with our key domestic partners using CSR self-assessment questionnaires. This effort aims to understand the current situation and drive improvements. The CSR self-assessment targets key suppliers, including those providing direct materials that account for 80% of our procurement volume and parts that have no substitutes, as well as suppliers of indirect materials related to equipment. We utilize Maxell's proprietary SAQ (Self-Assessment Questionnaire), developed in accordance with the RBA (Responsible Business Alliance) on-site audit standards. This initiative is part of a three-year plan.
*SAQ categories: Labor, Health and Safety, Environment, Ethics, Quality & Information Security, Management Systems
Performance
CSR Assessment (*1)
・Method
We conduct site surveys and support improvement activities for suppliers who receive a D grade in the SAQ evaluation. For those receiving a C grade, we request written responses to the improvement plan and maintain ongoing follow-up to foster further improvements, with the goal of elevating them to a B grade or higher. Since FY2021, we have been providing "Supply Chain CSR Procurement" training to our procurement staff to deepen their understanding and application of CSR principles (with 83 participants in FY 2021 and 90 participants in FY 2022).
*1 CSR Self-Assessment: This involves a self-evaluation to ensure adherence to the Maxell Group's Supply Chain CSR Procurement Guidelines.
・Summary of This Fiscal Year's Results
This initiative has been carried out as a three-year plan, with one cycle spanning three years, starting from FY2019. In the first three-year plan, the target suppliers were key direct material suppliers (accounting for 80% of procurement volume and those supplying parts that cannot be substituted). However, from the fourth year, FY2022, we expanded the scope to include equipment-related suppliers, receiving SAQ responses from 432 companies (347 direct material suppliers and 85 equipment-related suppliers). When the primary supplier was a trading company, we also requested SAQ responses from secondary suppliers. Regarding the evaluation results, there were no suppliers rated as D grade, and 7% (30 companies: 18 direct material suppliers and 12 equipment-related suppliers) were rated as C grade, for which we continue to follow up on the improvement plan.
・Topics
This fiscal year marks the first year of the three-year plan. As part of our CSR policy, we have re-informed our suppliers about our CSR Procurement Guidelines and requested their cooperation in CSR activities.
