Survey on Supply Chain CSR

To confirm the status of compliance with the Basic Supply Chain CSR Policy, Marubeni conducts on-site inspections of suppliers who are based in countries designated by the FTSE4Good Global Index as carrying a high risk associated with supply chain labor standards, and who trade in the apparel, agriculture, and other sectors. The person in charge from Marubeni directly visited the manufacturing sites, or production sites, of the suppliers to conduct such inspections.

In December 2016, Marubeni visited the rubber plantations and manufacturing plants of the following four Vietnamese companies, which are producers of natural rubber and suppliers to Marubeni Techno Rubber Corporation, a Marubeni Group company, to conduct on-site inspections for CSR issues: Dau Tieng Rubber Corporation, Phuoc Hoa Rubber JSC, Phu Rieng Rubber Co. Ltd. and Dong Nai Rubber Corporation.

During the course of these supply chain CSR inspections regarding the processes of procuring raw materials and the manufacturing of products, which covered legal compliance issues, human rights, environmental protection, fair trading, health and safety, quality control and information disclosure, no serious violations were discovered at any of the sites visited.

Labor laws and regulations are in place prohibiting child labor and excessive working hours, and regarding leave of absence, minimum wage, wage payment methods, social security, occupational health and safety and so on. Environmental protection laws on preventing contamination by wastewater, control of hazardous chemicals, waste disposal etc. are also applicable, and as part of their compliance with these laws the supplier companies report regularly to the authorities and have received official inspections. During our visits we found that the representatives of each of the supplier companies were highly cognizant of compliance requirements, and we were able to confirm that these laws and regulations were being observed appropriately.

Furthermore, through accreditation to ISO14001 international standards for environmental management and ISO9001 for quality control management, appropriate management systems are in place.

Dau Tieng Rubber Corporation

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Phuoc Hoa Rubber JSC

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Phu Rieng Rubber Co. Ltd

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Dong Nai Rubber Corporation

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In October 2015 a forest management council announced its decision to terminate the certification of the parent company of these suppliers, Vietnam Rubber Group (“VRG”), on the grounds that VRG’s rubber plantations in Cambodia and Laos had significant negative impacts on the environment and the livelihood of local communities.

However, we have confirmed that the 4 suppliers which we inspected do not procure any materials from the countries or regions which were mentioned in the reason for the termination.

In respect of VRG, we have requested them to take steps to ensure that their business does not have a negative impact on the environment or on human rights, and to strengthen management controls across the Group as a whole. We are also requesting VRG to continue discussions with the forest management council and to endeavor to regain the forest management certification in the future.

Supply Chain