Responsible Sourcing of Minerals

Responsible Minerals Sourcing

Policy for High Risk Minerals

Where minerals such as tin, tantalum, tungsten, gold (3TG) and cobalt are mined in conflict-affected or high-risk areas such as the Democratic Republic of Congo (DRC) and adjoining countries, the revenue from the mining and trading of these minerals is a source of funding for armed groups and anti-government forces carrying out atrocities and human rights abuses. Minerals sourced from such conflict-affected or high-risk areas have the potential to promote conflict, human rights violations and environmental degradation.

Epson considers mining to be an intensive process involving social and environmental risks, and believes the mining of metals and minerals, including conflict minerals (3TG) and cobalt mined in the DRC, as well as other minerals mined in other regions, must be managed.

Epson's policy is that we want no part in any human rights violations or environmental destruction. While sourcing minerals that originate in conflict-affected or high-risk areas, we will not, by any means, tolerate, knowingly profit from, contribute to, assist with or facilitate the commission by any party of any form of human rights violations or abuses, or support operations that result in the degradation of socioeconomic and environmental stability.

Management recognizes that responsible mineral procurement is a social issue that needs to be addressed. Epson has thus declared its commitment to responsible mineral sourcing in the Principles of Corporate Behavior, Epson's corporate code of conduct. Moreover, as a member of the Responsible Business Alliance (RBA) and the Responsible Minerals Initiative (RMI), we require our suppliers to adhere to this policy and expect them to support and promote compliance within the supply chain. We also ask them to understand and comply with the Epson Group Supplier Guidelines and the Epson Supplier Code of Conduct (RBA Code of Conduct). In 2020 and 2021, Epson had direct material suppliers submit an agreement letter stating that they would comply with responsible mineral sourcing requirements and cooperate in a conflict minerals survey.

Responsible Minerals Survey Program

Epson recognizes that the responsible sourcing of minerals is an important societal issue that it should address. To ascertain whether minerals are being sourced responsibly throughout the supply chain, Epson has established a survey system as stated in Principles of Corporate Behavior. The nature of actions to be taken are set forth in Key Sustainability Topics. Policies and results are discussed and reported at meetings of the Sustainability Strategy Council, a corporate management meeting that includes members of the board of directors.

Epson also established the Epson Group Responsible Minerals Survey Standard to use as a guide for conducting surveys throughout Epson's supply chain to check that Epson products contain responsibly sourced minerals. This standard is based on the Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas issued by the Organization for Economic Co-operation and Development (OECD).

Using the Conflict Minerals Reporting Template (CMRT) and Cobalt Reporting Template (CRT, to be called the Extended Mineral Reporting Template, or EMRT, from 2022) provided by the Responsible Minerals Initiative (RMI), we identify upstream smelters and refiners of conflict minerals (tin, tantalum, tungsten, gold, and cobalt) with the cooperation of direct material suppliers. We also check the country of origin by obtaining answers about the supply chain.
We seek to source minerals only from conflict-free smelters (CFS) certified by RMI's Responsible Minerals Assurance Program (RMAP). If it is unclear whether a smelter is a CFS, Epson tries to mitigate risk by asking tier 1 suppliers to source minerals from a different supplier.

Epson also uses socially responsible procurement supplier conferences and various other opportunities at our production facility sites around the world to promote understanding of Epson policies, asks suppliers to improve survey accuracy, and shares information about trends involving prioritised minerals. Epson will continue working with suppliers to make sure that minerals used in our products fulfill the standards set in our responsible minerals sourcing policy.

To responsibly source minerals used in Epson products, our program follows a five-step framework according to the Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas issued by OECD.

STEP 1: Establish strong company management systems.
Epson has established a Group-wide policy, a supply chain due diligence program, concludes written agreements with suppliers, and has established a grievance mechanism.

STEP 2: Identify and assess risks in the supply chain.
Epson identifies and assesses risks in our supply chain by conducting surveys.

STEP 3: Design and implement a strategy to respond to identified risks.
Epson reports the results of risk assessments to the Chief Procurement Officer, discusses risk mitigation plans with tier 1 suppliers, and monitors their performance.

STEP 4: Carry out independent third-party audit of smelter/refiner's due diligence practices.
Epson uses the results of the RMI's Responsible Minerals Assurance Program (RMAP) is assessments.

STEP 5: Report annually on supply chain due diligence.
Epson discloses its due diligence status on the company's official Web site, in an annual integrated report, and in other media formats.

Target and Results

The CMRT and CRT provided by the RMI is designed to allow the selection of (1) Company-wide, (2) Product (or List of Products), or (3) User-Defined as the declaration scope. However, we ask that suppliers select Product and answer with respect to specific products that are delivered to Epson so that we can verify the smelter of the minerals included in parts and materials used in Epson products. We believe that conducting the survey in this way will enable us to identify where we should mitigate risk and lead to effective due diligence.

In 2021, Epson conducted a survey of 3TG and cobalt1 and received completed surveys from 99% of the suppliers of parts/materials containing 3TG and 98% of the suppliers of parts/materials containing cobalt. If a smelter cannot be identified by analyzing answers received from a supplier, if there is a smelter that is not RMI-certified, or if there is a shortage of the parts subject to survey, we ask suppliers to conduct an additional, change suppliers, or take other action to mitigate risk.

Epson is not required to report to the US authorities as we are not listed in the United States, but we disclose identified smelter and refiner information.

3TG Survey Results

  FY2019 FY2020 FY2021
Total Tin Tantalum Tungsten Gold
Number of identified smelters*1 344 340 416 117 44 64 181
Number of CFS*2 268 242 239 56 39 43 106
Response rate from suppliers 91% 97% 99%  -  -  -  -

*1 For information (name, country, etc.) on identified smelters, see List of the RMI-recognized smelters and refiners identified in Seiko Epson's supply chain.(PDF 257 KB)
*2 Conflict-free smelters (CFS) certified by RMI's Responsible Minerals Assurance Program (RMAP).
  For detailed information on conflict minerals surveys for individual products, please contact your local Epson sales company.

Cobalt survey result

Number of identified smelters 86
Number of CFS*1 23
Response rate from suppliers  98%

*1 Conflict-free smelters (CFS) certified by RMI's Responsible Minerals Assurance Program (RMAP).
  For detailed information on conflict minerals surveys for individual products, please contact your local Epson sales company.

3TG survey results (for procured parts)

About 70% of the 80,000 parts and materials that were subject to the 2021 survey contained 3TG. We were able to identify that 57 percent of these (roughly 50,000 parts) were sourced from RMI-certified conformant smelters.

Providing information and education to suppliers

Epson believes that responsible sourcing of minerals is an important societal issue that needs to be addressed, and since supplier cooperation is essential for achieving this, Epson strives to inform and educate its suppliers.

Throughout the year, we provide the following tools and information to ensure that suppliers always have up-to-date and easily accessible information:
- Excel Check Tool to check a smelter's or refiner's current certification information
- Certification renewal information for smelters and refiners

In addition, we analyze the answers of suppliers who complete the surveys and provide them with detailed feedback on results, indicating what might have been missing and where risk mitigation is needed.

The feedback, which is issued on each reporting template, is intended to clearly indicate where a supplier needs to exercise due diligence.

We also explain the reporting templates and provide individual support for completing them in response to requests from suppliers.

Result of Third-party Audit

Epson receives RBA VAP audit at manufacturing site in the world.

VAP (RBA Validated Assessment Program) Audit result in 2020 and 2021, all sites comply with the standards required by the RBA on section D7, Responsible Sourcing of Minerals

Manufacturing Site Country Main Products Manufactured
PT. Indonesia Epson Industry Indonesia Printers
Epson Engineering (Shenzhen) Ltd. China Printers
Epson Precision (Philippines), Inc. Philippines Printers
Epson Precision (Thailand) Ltd. Thailand Device products
Epson Precision Suzhou Co., Ltd. China Device products
Epson Precision Malaysia Sdn. Bhd. Malaysia Device products

Requirement of RBA Code of Conduct D7 (Responsible Sourcing of Minerals):
Participants shall adopt a policy and exercise due diligence on the source and chain of custody of the tantalum, tin, tungsten, and gold in the products they manufacture to reasonably assure that they are sourced in a way consistent with the Organisation for Economic Co-operation and Development (OECD) Guidance for Responsible Supply Chains of Minerals from Conflict- Affected and High-Risk Areas or an equivalent and recognized due diligence framework.

Partnerships with External Organizations

Epson believes that, in addition to our individual efforts, it makes sense to support and participate in alliances and/or initiatives to address the issue of conflict minerals.

To promote responsible sourcing of minerals and to foster cooperation to promote activities and conflict mineral surveys in the supply chain, Epson has joined the following initiatives:

2. Domestic Japanese industry initiative
The Responsible Minerals Trade Working Group of the Japan Electronics and Information Technology Industries Association (JEITA).
Examples of activities: Participation in RMI, researching and sharing the regulatory situation in other countries, training and educating suppliers, encouraging RMI uncertified smelters to undergo audits, etc.

Grievance Mechanism

Epson complies with the Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas issued by the Organization for Economic Co-operation and Development (OECD) and accepts notification from suppliers concerning mineral sourcing risks.