- Supply Chain CSR Vision
- Sustainable Procurement Policy
- Supply Chain CSR Strategy
- Key Goal Indicators (KGI) and Key Performance Indicators (KPI)
- External Recognition
Supply Chain CSR Vision
Epson aspires to be an indispensable company, one that seeks to build mutually beneficial relationships with all its business partners, including suppliers. Toward this end, we ask our suppliers to uphold the highest standards of integrity and ethics while, at the same time, respecting their autonomy and independence.
In 2021, Epson identified four materialities (priority issues) that it should address to help solve societal issues and advance toward its aspirational goal of achieving sustainability and enriching communities. Epson selected 12 key sustainability topics that it will act on to achieve these. The key sustainability topics, one of which is “realizing responsible supply chains,” have been mapped to the 169 targets of the 17 Sustainable Development Goals (SDGs) of the United Nations. We will help to achieve the SDGs by strengthening supplier CSR activities across the entire Epson Group.
Epson has joined the Responsible Business Alliance (RBA) and supports RBA’s mission and code of conduct, which consists of internationally recognized, ambitious CSR requirements covering human rights, health and safety, the environment, and ethics. The RBA Code of Conduct is regularly reviewed and revised to establish common requirements that the electronics industry should work toward together.
As a Regular Member of the RBA, Epson is expected to observe the RBA Code of Conduct and meet its supply chain due diligence obligations at a high level. Accordingly, in addition to ensuring compliance in our own operations, we ask our suppliers to observe the requirements and promote CSR across the entire supply chain.
Sustainable Procurement Policy
In Principles of Corporate Behavior, Epson describes principles of conduct that must be practiced in order to achieve the goals stated in Epson’s Management Philosophy. Building and maintaining mutually beneficial relationships with suppliers is one of these principles, as are CSR-related issues such as respect for human rights, environmental impact mitigation, compliance, and responsible sourcing of minerals.
In addition to the principles of conduct stated in Principles of Corporate Behavior, Epson’s Basic Procurement Policy sets forth fundamental practices for optimizing and stabilizing quality, cost, and delivery (QCD).
Under these overarching policies, we have established the Epson Group Supplier Guidelines. We provide our suppliers with the Guidelines to familiarize them with the fundamental procurement requirements to which we ask them to adhere.
The Epson Group Supplier Guidelines includes a Code of Conduct pertaining to labor, health, safety, environment, ethics, and management systems. This Code of Conduct is based on the Responsible Business Alliance (RBA) Code of Conduct.
Supply Chain CSR Strategy
Epson wants to help solve societal issues and achieve sustainable growth through sustainability initiatives that are aligned with the Principles of Corporate Behavior, which is based on the idea of building social trust, the concept that underlies Epson’s Management Philosophy. Not only do we comply with local laws and regulations in the countries and regions where we operate, we also respect international sustainability initiatives such as the Sustainable Development Goals (SDGs) and the RBA code of conduct.
Furthermore, as outlined in the United Nations Guiding Principles on Business and Human Rights, Epson’s responsibility extends to its supply chain. Aspiring to achieve sustainability and enrich communities, we have established strategic actions in four areas to achieve, by 2030, socially responsible supply chains from the standpoints of human rights and sustainability.
These actions will also lead to the achievement of the SDGs by the 2030 target year.
The chief officer of supply chain management (SCM), a member of Seiko Epson’s board of directors, promotes social responsibility in supply chains in conjunction with all entities within the Epson Group.
The Sustainable Procurement Committee is a cross-organizational body made up of personnel from all Epson's operations divisions and from the procurement departments of Epson Group companies, with administrative oversight provided by the Seiko Epson Head Office department that supervises socially responsible procurement. The committee discusses targets and action plans, gets them approved by the chief officer responsible for promotion of supply chain management (SCM), communicates them to the entire Group, and puts those targets and action plans into effect. The chief officer of SCM promotion monitors the progress of action plans, and progress is regularly reported to the Sustainability Strategy Council, a corporate management meeting body that includes members of the board of directors.
Key Goal Indicators (KGI) and Key Performance Indicators (KPI)
To realize our vision of socially responsible supply chains, we set mid-term goals and annual targets. Performance and progress against the goals and targets are measured using KGI and KPI, respectively.
Mid-Term Goals (to be achieved by March 31, 2026)
Socially responsible procurement: Ensure that all major suppliers are ranked low risk in terms of CSR.
Responsible mineral sourcing: Make products conflict-mineral-free1 and disclose product information.
1 Use only conflict-free smelters and refiners certified under the RMI’s Responsible Minerals Assurance Program (RMAP).
FY2022 Action Items and Results
|Action Items and KPI||Result|
|1||Strengthen the CSR self-assessment questionnaire (due diligence):
1) CSR SAQ results: high risk 0%, medium risk: 6% or less
2) Completion rate of risk mitigation activities1 for certain priority items: KPI 100%
1) Major suppliers of direct materials
0% high risk (0 sites) and 9% medium risk (42 sites)
2) Major suppliers of direct materials
84% completion rate (146 out of 173 suppliers)
|2||Strengthening conflict minerals survey
1) Elimination of smelters who are not conflict-free certified by performing due diligence
2) Survey return rate: 100%
1) Feedback to suppliers using smelters that are not conflict-free certified:
2) Return rate
CMRT (3TG2): 99%
EMRT (cobalt): 97%
|3||Strengthening CSR engagement with suppliers:
1) Supplier CSR meetings: Hold at 100% of manufacturing sites
2) Discussions with suppliers on CSR: 20 companies
1) 100% (15 sites)
2) 16 companies
1 Risk mitigation activities for certain priority items: At Epson, “certain priority items” are human rights-related issues that are rated priority non-conformances under the RBA’s Validated Assessment Program (VAP) audit standards. If an answer on an SAQ corresponds to such an issue, the supplier is asked to take corrective action and we check progress.
2 3TG: tin, tantalum, tungsten and gold
FY2023 Action Items
|1||Improvement in CSR||CSR SAQ results (major suppliers of direct materials):
0% high risk (0 companies) and 4% medium risk (20 companies) or less
|2||Strengthening conflict mineral surveys||1) Survey return rate: 100% (1,500 companies)
2) Feedback to suppliers using smelters that are not conflict-free certified: 100% (750 companies)
|3||Strengthening CSR engagement with suppliers||Supplier CSR meetings: Hold at 100% of manufacturing sites (15 main manufacturing sites)|
Supply chain CSR is evaluated by many rating agencies as part of the "S" (Social) component of ESG (Environmental, Social, and Governance) assessments. Among the supply chain CSR topics examined are policies, human rights due diligence, and responsible sourcing of minerals.
Epson’s efforts and achievements in supply chain CSR have received recognition from various ESG rating agencies.
In the latest sustainability assessment by France-based EcoVadis, Seiko Epson Corporation earned a Platinum rating for the third consecutive year. This award puts Seiko Epson in the top 1% of companies among approximately 100,000 companies worldwide assessed by EcoVadis. In addition to an overall score, EcoVadis provides scores for environmental, labor and human rights, ethics, and sustainable materials sourcing performance. Seiko Epson received its highest score in sustainable materials sourcing.