Working with Mazda’s Suppliers
Mazda carries out a wide variety of activities in order to achieve mutual growth and prosperity with suppliers and dealerships, both in Japan and overseas. In line with its basic purchasing policy, Mazda is taking its efforts to build open business relationships and ensure fair and evenhanded dealings with its suppliers both in Japan and overseas.
In addition, Mazda is committed to promoting CSR initiatives and enhancing BCP aimed at building a sustainable society in full partnership with its suppliers. The Company bases its assessments of business dealings with its suppliers on a comprehensive evaluation that covers not only quality, technical strengths, pricing, delivery time and financial conditions, but also the corporate compliance structure and initiatives for environmental protection.
Basic Purchasing policy
Mazda will, in the fullest sense of coexistence and mutual prosperity, engage in research and production for improved competitiveness. The Company will build open and fair business relationships to ensure sustainable growth and raise its level of contributions for social and economic development. (1994)
Number of Suppliers (As of March 31, 2016)
|Equipment and tools||390|
Purchasing Cooperative Organizations*1
(As of March 31, 2016)
(Raw materials, equipment, molds, etc.)
*1 An autonomous management organization, comprising suppliers that have a certain degree of transaction with Mazda, with the purpose of strengthening relationships between Mazda and its suppliers as well as promoting mutual growth and prosperity.
Measures Based on the Basic Purchasing Policy
- ■ Mazda extends opportunities to businesses throughout the world, regardless of nationality, scale or history of transactions with the Company.
- ■ Upon receiving a request to start business with Mazda, Mazda assesses the company in question in a fair and even-handed manner according to its in-house criteria for evaluation of suppliers, and determines the feasibility of a business partnership.
- ■ Mazda requests that suppliers comply with Mazda Supplier CSR Guidelines and Mazda Green Purchasing Guidelines.
<Examples of Specific Measures>
- ■ Publishing of the “Request for Thorough Compliance with Labor Related Laws” for all suppliers (January 2005)
- ■ After holding briefing sessions for employees and suppliers based on the “Guidelines for Appropriate Transactions in the Automobile Industry” formulated by the Ministry of Economy, Trade and Industry (2008), continuous communication is held to related parties inside and outside the Company on every subsequent revision of the Guidelines.
- ■ Clarification of the behavioral guidelines for appropriate transactions by formulating the “Promotion Manual for Appropriate Purchasing” (2008)
- ■ Posted relative materials to exclusive access site for suppliers in order to continue supplier education (August 2011 -) Recently, in line with the revision of the “Guidelines for Appropriate Transactions in the Automobile Industry” in January 2016, a modified version of the “Promotion Manual for Appropriate Purchasing” was posted (June 2016). Other materials posted include: “Behavioral Guidelines on Appropriate Purchasing,” “Causes of and Countermeasures against Problematic Transactions,” and “Specific Handling Policies by Each Category of Disputable Transactions.”
Mazda Supplier CSR Guidelines
To promote CSR activities among Mazda suppliers, in July 2010 Mazda created the Mazda Supplier CSR Guidelines with reference to the CSR Guidelines of the Japan Automobile Manufacturers Association. In addition to requesting total compliance with the laws and regulations of all countries and regions, the Guidelines outline six areas such as respect for people including the prohibition of child labor and forced labor, environmental protection and information disclosure, and request that all Mazda suppliers comply with the guidelines in these areas.
For the revision of the guidelines in July 2013, Mazda provided the clear policy toward disuse of raw materials, which should be the cause of social issues, including conflict minerals*2, and also requested suppliers to comply with it. The Mazda Green Purchasing Guidelines, which indicates the detail of the environmental protection area, is separately created and Mazda requests suppliers to comply with them.
*2 Conflict Minerals: Minerals and their derivative metals designated by Financial Regulatory Reform Article 1502 that are sourced from and used as financial source of armed groups in the Democratic Republic of Congo or the surrounding countries (Regulated minerals: tantalum, tin, tungsten, gold)
“Mazda Supplier CSR Guidelines” and “Mazda Green Purchasing Guidelines”
Mazda Supplier CSR Guidelines
Mazda Green Purchasing Guidelines
Questionnaire Survey for Suppliers
Aiming to establish a system to understand and evaluate the status of CSR implementation, Mazda conducts questionnaire surveys for its suppliers.
The CSR questionnaire survey was introduced in FY March 2014 for the purpose of comprehensively determining the CSR implementation status of suppliers.
Target of the survey in FY March 2016
Results of Supplier CSR Survey
(target: 51 local suppliers)
|FY March 2016||
|Mazda Supplier CSR Guidelines are introduced within the company or to suppliers.||100％|
|CSR education is provided.||
Survey on Conflict Minerals
Believing that the status of use of conflict minerals should be clarified urgently and in detail, Mazda conducts a separate survey on this issue. Based on the pilot survey in FY March 2015, the Company conducted a full-scale survey in FY March 2016 targeting 301 suppliers of the parts and materials of the vehicles to be supplied to Toyota Motor Corporation, in response to its request.
The Supplier Evaluation System
When starting business with a new supplier, related departments coordinate together to confirm the supplier’s quality control system, research & development system, technological capabilities, financial conditions, and CSR initiatives, in order to evaluate whether or not the supplier is compliant with the procurement/selection policies of the Mazda Group.
For each long-term supplier, Mazda conducts not only an evaluation based on the quality, pricing and delivery time of procured goods or service, but also a comprehensive evaluation of the entire business including its quality control system, research & development system, and technological capabilities. For the supplier quality control system, Mazda employs a system that enables continuous grasping of issues, evaluation of the situation, and provision of guidance for improvement by receiving daily reports on product quality as well as voluntary audit results, and when a supplier is in need of quality improvement, conducts quality auditing that involves on-site confirmation of actual products at both domestic and overseas sites.
Also, Mazda comprehensively evaluates its suppliers every year (257 suppliers in 2015) from the perspectives of quality, pricing, delivery time, etc., in order to build more positive business relationships with them, and passes the results of these evaluations back to the suppliers. Outstanding suppliers are recognized with awards. The Company has also introduced CSRbased evaluation, giving special awards to suppliers that have made outstanding proposals on weight trimming, which greatly affects environmental performance such as fuel efficiency.
Evaluation items when starting business with a new supplier
Quality management system, research & development system, technological capacity, production and delivery capacity, financial conditions, CSR initiatives, etc.
Evaluation items for long-term suppliers
Quality management system, research & development system, technological capacity, production and delivery capacity, financial conditions; quality, pricing, delivery time of goods or services procured, and other items in the Supplier CSR Guidelines.
Handling of Business Continuity (BCP) in the Supply Chain
Mazda is presently upgrading and expanding its business continuity plan (BCP) to prepare for risks and avoid long-term suspension of business that would extensively impact society. For procedures when suppliers are affected by disasters, the Company has compiled the Risk Management Procedures for Affected Suppliers. Assuming a large-scale disaster, risks for each supplier were identified in terms of substitutability, location, and business continuity. By sharing the identified risks, measures against them will be developed. To enable early recovery while placing the highest priority on human life, the Company has introduced the “SCRkeeper,”*3 a supply chain risk management system, with the aim of enhancing its initial response and risk management. The Company will continue to enhance its BCP.
*3 Supply Chain Resiliency system This is a system combining map data with the earthquakes information by the Meteorological Agency, with which the seismic intensity of the registered production sites can be found quickly in the event of an earthquake.
Communicating with Suppliers
To enable coexistence mutual growth and prosperity for all parties, along with the overarching goal of building high-quality vehicles, Mazda Group, seeing all the suppliers as its important business partners, takes steps to promptly brief suppliers on medium to long-term business strategies and on matters related to sales and production, and arranges opportunities for the exchange of information on a regular basis.
The Company also maintains close liaisons with supplier-managed purchasing cooperative organizations*4.
For example, staffs from member companies visit each other’s offices in order to exchange examples of successful approaches and practices through subcommittee activities. For FY March 2016, 128 companies conducted a total of 69 activities.
Lecture at Supplier Communication Meeting “Mazda’s CSR initiatives” (September 2015)
*4 Yokokai member companies: 170 parts suppliers, Yoshinkai member companies: 81material suppliers
The procurement amount from member companies of Yokokai and Yoshinkai accounts for about 90% of the whole.
Major Channels of Communication with Supplier
|Roundtable Conference with Cupplier Management||Executive-level management at major suppliers||Once a year||
|Supplier Meeting||Representatives of frontline business divisions and departments at major suppliers||Once a year||
■ Mazda’s specific purchasing policies are explained to representatives of frontline business divisions at suppliers, based on the explanation given at the roundtable conference by the general manager of the Purchasing Division. This helps to promote a better understanding of Mazda and provides useful input for the work that suppliers do.
|Supplier Communication Meeting||Representatives of frontline business divisions and departments at major suppliers||Once a month||
■ To facilitate smoother collaboration with its suppliers, Mazda provides them with information such as topics concerning daily operations between Mazda and its suppliers (including CSR), production/sales status, quality status of purchased materials, pilot construction schedules for newly developed models, and mass-production implementation schedules for new models.
■ Mazda also employs a range of other communication channels, by using the in-house “Mazda Technical Review”, highlighting new technologies and research.
Other Measures for Supplier Support
- 1. Change to the Milk-Run system: Mazda has shifted from the conventional system, with delivery of parts by each supplier, to the Milk-Run system (MRS), in which Mazda trucks stop at multiple suppliers to collect parts. This system reduces workload in logistical operations and contributes to reduced environmental impact.
- 2. Mazda provides advice on joint subscription systems for product liability insurance, which reduces manufacturers’ liability risks for parts.
- 3. Mazda provides information on third-party exhibitions and conventions to showcase the latest technologies and manufacturing methods.
- 4. Mazda ensures the proper return of logistic pallets/containers at suppliers, based on collaboration between the purchasing and logistics related departments.
In-House Education to Ensure Fair Transactions
The following educational initiatives are conducted for those engaging in procurement operations in order to realize fair and equal transactions.
- ■ Administering comprehension tests on the Subcontractors Act
- ■ Education on financial control
- ■ Posting of guides and process rules regarding appropriate transactions and compliance on the Purchasing Division website on the Intranet
- ■ Participation in the “Seminar for the improvement of subcontracting transactions” hosted by the National Association of Trade Promotion for Small and Medium Enterprises