Supply Chain Management for Specific Commodities
To realize a sustainable society by working together with our suppliers and business partners, Sumitomo Corporation has established the CSR Action Guidelines for Supply Chain Management. We have also established specific policies for natural resource-related commodities requiring sustainable procurement.
Forest Management
Sumitomo Corporation Group Forest Management Policy
Established in March 2022
Scope of application
Forestry business directly managed by Sumitomo Corporation and its Consolidated subsidiaries. In addition, other forestry business that Sumitomo Corporation and its subsidiaries are involved in management are included if determined to be material.
Governance
This policy was approved by the Management Council and the Board of Directors of Sumitomo Corporation. If any serious issues arise in implementing this policy, measures and corrective action plans will be discussed at the Corporate Sustainability Committee and reported to the Management Council and the Board of Directors.
Commitment
Based on the principles of zero deforestation and respect for human rights, Sumitomo Corporation will strive to implement the following in its sustainable forest management, with the cooperation of its Group companies.
Environmental aspects:
- We will not engage in development that leads to gross deforestation, or the conversion of natural forests into plantations for forestry business.
- We will not develop forests with high conservation value (HCVF), or forests with high carbon stock (HCSF) such as in peatlands.
- We will work to protect endangered species and reduce the impact of our forestry business on ecosystems.
- We will conduct thorough management to prevent forest fires and will not conduct any operations which can cause forest fires.
- We will engage in forest conservation and reforestation.
Social aspects:
- We will conduct our forestry business with consideration for human rights in accordance with the Sumitomo Corporation Group’s Human Rights Policy.
- We will respect human rights as stipulated in the “International Bill of Human Rights” and the International Labor Organization’s “Declaration on Fundamental Principles and Rights at Work,” and we will operate in accordance with the “United Nations Guiding Principles on Business and Human Rights.”
- We will respect international norms related to the rights of indigenous peoples, such as the “United Nations Declaration on the Rights of Indigenous Peoples” and the “principle of Free, Prior and Informed Consent (FPIC).”
- We will support local communities through creating employment and offering educational programs related to forests.
Operational guidelines for Forest Management Policy
To reinforce due diligence to mitigate risks, we have also set operational guidelines for putting the policy into actions.Risk assessment and monitoring:
- We will conduct environmental and social risk assessments in accordance with the Sumitomo Corporation Group Forest Management Policy before starting any new forest management. In addition, we will continue monitoring the status of our environmental and social commitments after the project started.
Certification:
- In addition to the above monitoring, we will make effective use of the internationally recognized forest management certification system for the forests managed by the Group and promote obtaining certification.
Stakeholder dialogue:
- In order to prevent global deforestation and forest degradation, we will promote the sustainable use of forest resources in society through dialogue with our stakeholders in the regions where our forests are located.
- We will develop a grievance mechanism* to respond to issues raised by our stakeholders.
Disclosure:
- In order to implement forest management with high level of transparency, we will strive to disclose information on our initiatives in accordance with the Sumitomo Corporation Group Forest Management Policy.
Reviewing process of the Guidelines:
- The Business Units will annually report on implementation of the policy to the Corporate Sustainability Department.
- Based on the report, the Corporate Sustainability Department will annually review the necessity of updating the Operational Guidelines.
- If any serious issues arise in implementing this policy, measures and corrective action plans will be reported to the Management Council and the Board of Directors.
* A process that employees, local residents or other stakeholders can use to lodge complaints regarding human rights violations and other issues related to enterprise’s business activities including its supply chain, for resolving such issues
Sourcing of Forest Products
Sumitomo Corporation Group Sourcing Policy for Forest Products
Established in March 2022
Scope of application
Logs, wood products (plywood, lumber, veneer, laminated timber), wood chips and wood pellets traded by Sumitomo Corporation and its Consolidated subsidiaries.
Governance
This policy was approved by the Management Council and the Board of Directors of Sumitomo Corporation. If any serious issues arise in implementing this policy, measures and corrective action plans will be discussed at the Corporate Sustainability Committee and reported to the Management Council and the Board of Directors.
Commitment
In accordance with the principles of zero deforestation and respect for human rights, Sumitomo Corporation will strive together with its Group companies to source products based on this policy while cooperating with suppliers and customers.
Environmental aspects:
- We will not procure materials sourced from lands associated with destructive forest use or development which leads to gross deforestation causing significant environmental impacts.
- We will not procure materials sourced from lands associated with serious environmental issues including the destruction of forests with high conservation value (HCVF) or high carbon stock (HCSF) such as in peatlands.
- We will not procure materials produced from genetically modified wood.
- We will procure in compliance with the Washington Convention to protect endangered species.
Social aspects:
- We will procure products harvested in forests where human rights are respected in accordance with the Sumitomo Corporation Group’s Human Rights Policy.
- We will respect human rights as stipulated in the “International Bill of Human Rights” and the International Labor Organization’s “Declaration on Fundamental Principles and Rights at Work,” and we will operate in accordance with the “United Nations Guiding Principles on Business and Human Rights.”
- We will respect international norms related to the rights of indigenous peoples, such as the “United Nations Declaration on the Rights of Indigenous Peoples” and the “principle of Free, Prior and Informed Consent (FPIC).”
- We will not procure materials produced from illegally logged wood.
Operational guidelines for Sourcing Policy for Forest Products
To reinforce due diligence to mitigate risks, we have also set operational guidelines for putting the policy into actions.Monitoring:
- In order to procure forest products in accordance with the “Sumitomo Corporation Group Sourcing Policy for Forest Products,” we will promote the use of products that have been certified by reliable international forest management certification systems. Additionally, we will request detailed information from suppliers through audit activities such as questionnaires and on-site visits.
- In order to ensure compliance with the Commitment, we will conduct supplier risk assessments and consult with non-compliant suppliers to request improvements. If no improvement is observed, we will consider reviewing the transaction.
Stakeholder dialogue:
- In order to prevent global deforestation and forest degradation, we will promote the sustainable use of forest resources in society through dialogue with our stakeholders, including suppliers and customers.
- We will develop a grievance mechanism* to respond to issues raised by stakeholders.
Disclosure:
- We will strive to disclose the status of our initiatives based on the “Sumitomo Corporation Group Sourcing Policy for Forest Products,” including reporting on monitoring results.
Reviewing process of the Guidelines:
- The Business Units will annually report on implementation of the policy to the Corporate Sustainability Department.
- Based on the report, the Corporate Sustainability Department will annually review the necessity of updating the Operational Guidelines.
- If any serious issues arise in implementing this policy, measures and corrective action plans will be reported to the Management Council and the Board of Directors.
* A process that employees, local residents or other stakeholders can use to lodge complaints regarding human rights violations and other issues related to enterprise’s business activities including its supply chain, for resolving such issues
