Initiatives

Issued in November 2004, the Clean Procurement Declaration sets out the basis for our CSR-conscious procurement activities. It stipulates an employee code of conduct and compliance items such as a rule prohibiting employees from accepting supplier invitations to dinners or other business entertainment. We have also set up the Fair Business Hotline for suppliers to contact Panasonic with any concerns or questions.

By first undertaking CSR activities ourselves, and then entering into partnerships with suppliers with a similar commitment, we are promoting the realization of CSR throughout the supply chain.

By first undertaking CSR activities ourselves, and then entering into partnerships with suppliers with a similar commitment, we are promoting the realization of CSR throughout the supply chain.

Panasonic first started "green procurement" activities in 1999. Today, we conduct environmentally conscious purchasing worldwide. As part of measures to comply with the EU RoHS Directive, between December 2003 and April 2004 we organized meetings in 16 locations around the world to discuss green procurement standards with approximately 9,000 suppliers. As part of our response to RoHS, we requested that suppliers provide non-use warranty certificates for chemical substances specified in the directive (lead, mercury, cadmium, hexavalent chromium and certain specified brominated flame retardants). All companies complied with this request. In addition, we asked suppliers to complete a survey of managed chemical substances to generate information for our online Green Products database (over 900,000 pieces of data were provided).

Since fiscal 2005, we have implemented a system of regular environmental audits to evaluate the quality assurance (QA) systems of our suppliers. These audits covered about 7,100 companies during fiscal 2007. Future plans call for extending such QA audits all the way up the supply chain to include sources of raw materials. Based on the audit results, we also assist suppliers in upgrading the quality of operations. In a separate move designed to upgrade chemical substance monitoring systems related to procurement, we have installed 400 X-ray fluorescence spectrometers at Panasonic sites worldwide to aid in the analysis of supplied parts and materials.

Such initiatives helped us to achieve full global RoHS compliance for all products in October 2005, ahead of the rest of the industry as well as the scheduled enforcement date of July 2006. Product-related legislation and other regulations continue to advance in all countries and regions of the world, prompting ongoing efforts on our part to upgrade and strengthen compliance systems.

In fiscal 2008, we plan to implement measures covering our supply chain to curb CO2 emissions, now a global issue. Initially these measures will be implemented on a trial basis, with the planned introduction of a full-scale program in fiscal 2009.

Compliance is a prerequisite to the conduct of business. As a responsible corporate citizen, Panasonic aims to uphold social norms, laws and regulations in every country and region, including laws in Japan relating to the use of subcontractors and the customs and tariff laws that apply to global procurement. We aim to conduct all purchasing activities with honesty and sincerity, respecting the spirit of free and fair competition.

In Japan, training courses, audits and other measures aim to ensure full compliance with laws governing the use of subcontractors. We also use IT to implement structures to prevent compliance violations in the event of errors. Similarly, we request and ensure that our suppliers comply with such laws and regulations.

Panasonic's Basic Purchase Agreement requires suppliers to respect the rights of all employees in a number of areas, including equal-opportunity employment, a ban on discrimination in the workplace, respect for privacy and the maintenance of good workforce relations. As well as requiring suppliers not to use any forced or child labor or to allow any illegal working practices, Panasonic also seeks to ensure that suppliers comply fully with labor laws and regulations relating to employment conditions while maintaining health-conscious, safe and comfortable working environments.

Our procurement activities focus on excellent suppliers based on a three-stage process, involving (1) a preliminary review, (2) the signing of a Basic Purchase Agreement, and (3) scheduled audit and evaluation. In the event that a supplier breaks the Basic Purchase Agreement, they are expected to promptly rectify the situation and issue a report to Panasonic. We expect strict compliance with these agreements, and in some cases we respond to violations by scaling down or even ceasing trading with the supplier.