Responsible Procurement

Shiseido wants to develop together with society while promoting respect for human rights and ensuring environmental protection in all its business activities, including the procurement of raw materials. By complying with laws and having a high sense of ethics, we are working on the following to achieve sustainable procurement and corporate social responsibility.

Ethical Supply Chain Policies/Standards

Shiseido Group Supplier Code of Conduct

Shiseido Group Supplier Code of Conduct (Issued in Jun 2019)［ PDF : 876KB ］

Shiseido aims to find new and profound values through encounters with diverse groups of people, to create a “beautiful life” culture, and to engage in research, development, manufacturing, and the sales of superior products and services of a high quality, safety, and which deliver peace of mind. We regard all business partners as partners who create new values together and aim for sustainable development with high ethical standards. In the wake of our participation in the United Nations Global Compact, Shiseido has been working with our business partners on ethical business activities since we formulated the Shiseido Group Supplier Code of Conduct in 2006, stipulating the standards regarding human rights, legal compliance, labor practices, intellectual property protection, confidentiality, environmental protection, and fair trade. The business partners that are subject to the Shiseido Group Supplier Code of Conduct have agreed to the standards and we conduct periodic monitoring through surveys and audits. In the event that any supplier is identified to have violated the Shiseido Group Supplier Code of Conduct, we strictly implement a request for corrective action, offer corrective guidance, and provide support. In Japan, we also established the Business Partner Hotline and we have a system in place to receive opinions and consult with our business partners (No reporting was made in FY2018.). In recent years, with social issues and environmental problems becoming more serious, companies are more strongly required not only to comply with the laws and regulations of each country, but also to respect international treaties and conventions in order to realize sustainability throughout the supply chain and, in particular, to ensure respect for human rights. In response to such social demands, we revised the Shiseido Group Supplier Code of Conduct in April 2018, including strengthening the human rights provisions. In June 2019, we also added a provision for the proper management of working hours, days-off, and leave of employees.

Shiseido Group Procurement Policy

“Shiseido Group Procurement Policy”［ PDF : 136KB ］

In order to achieve an ethical supply chain, the policy was established in 2018 based on fruitful coexistence with consumers, business partners, and society. The policy indicates the following: Our purchase principles are based on a consumer-oriented perspective; we carry out procurement activities to create better products through co-creation with business partners; we comply with all relevant laws and regulations, as well as placing the foremost priority on respect for human rights and consideration of the global environment; and we actively promote sustainable procurement.

Shiseido Group Sustainable Raw Materials Procurement Guidelines

“Shiseido Group Sustainable Raw Materials Procurement Guidelines”［ PDF : 131KB ］

This is a guideline formulated in 2018 for palm-derived materials, which exacerbate environmental and human rights problems in the country of origin, in order to promote sustainable procurement under the Shiseido Group Procurement Policy. We will promote sustainable procurement that respects human rights in consideration of the environmental protection of the place of origin.

Supplier monitoring/collaboration

Since having developed the Shiseido Group Supplier Code of Conduct in 2006, we have been implementing the Shiseido Supplier Code of Conduct Compliance Survey (Shiseido's proprietary SAQ^*), which confirms the compliance status of suppliers. In 2018, of the suppliers who have trading records with our Purchasing Department in our Global Headquarters, we received responses from 197 suppliers and provided feedback of the analysis and evaluation results of the survey to each company. To suppliers who did not complete the survey and provided answers that we need to confirm, we asked them to complete the survey again and sent inquiries about the responses. In addition, in August 2017, we joined Sedex (platform to share supplier ethical data). In 2018, we discussed the use of Sedex and the sharing of their ethical information with our primary suppliers (compliance, environmental, human rights, and occupational safety and health) from 45 sites in 31 companies. Furthermore, regarding suppliers who do not complete Shiseido’s unique SAQ or participate in Sedex, we share the evaluation results of other accreditation organizations, the acquisition status of international standards certifications, and we are promoting supplier monitoring from multiple perspectives.

• *SAQ:Self-Assessment Questionnaire

• *Excludes 3 duplicate suppliers

Reporting and consultation center for suppliers

Since 2013, we have been hearing opinions from/consulting with our business partners using the Business Partner Hotline a center which receives reporting/consultations from suppliers in writing and by email (No reporting was made in FY2018.).

Sustainable procurement of raw materials (palm oil/mica)

With regard to raw materials (palm oil/mica), which our company considers to carry high risk for human rights, we will strengthen our measures by participating in international initiatives.

Risk assessment of raw materials (social risk assessment when introducing new raw materials)

In order to understand issues such as human rights and labor issues on the supply chain in raw material procurement, we are conducting a social risk assessment of raw materials used by Shiseido. We analyzed palm oil using Social Hotspot Database (SHDB), made by nonprofit organization, New Earth, and discovered that the size and type of risks differs depending on the country of origin. By examining materials other than palm oil using SHDB, we plan to build a tool to identify social risks and use it when introducing new materials. By evaluating and appropriately managing the risks of each raw material, we will endeavor to manufacture products that customers can use with peace of mind, even with an understanding of the background of the products.

Dialogues with stakeholders

In order to ensure sustainable and responsible procurement and respect for human rights in the course of our business activities, Shiseido works with various stakeholders to discuss environmental and social issues, to share information, and to create resolutions.

Dialogue with human rights experts

In September 2018, we talked with human rights experts (Danish Institute for Human Rights, Institute for Human Rights and Business, and Verisk Maplecroft) and received advice on how to proceed with human rights due diligence in our company. We are implementing this knowledge in our efforts.

Photo 1: Exchange of opinions with palm farmers in Indonesia

Photo 2: Dialogue with human rights experts,
such as the Danish Institute for Human Rights