In light of the recent expectations of society regarding sustainability, Mazda is promoting compliance with the labor laws of the countries and regions in which it operates, including those regarding the prohibition of child and compulsory labor. In addition, the Company respects the Charter of Corporate Behavior issued by Keidanren (Japan Business Federation) and other international standards and engages in a wide range of initiatives for facilitating coexistence and mutual growth with suppliers in Japan and overseas.
SUPPLY CHAIN MANAGEMENT
Basic Approach
Initiatives
Efforts Targeting Mazda’s Suppliers
In line with its basic purchasing policy, Mazda is making efforts to build open business relationships and ensure fair and evenhanded dealings with its companies both in Japan and overseas, while extending opportunities to businesses throughout the world, regardless of home country, scale, or history of transactions with the Company. Upon receiving a request to start business with Mazda, we will assess the company in question in a fair and evenhanded manner according to our in-house criteria for the evaluation of suppliers in order to determine the feasibility of a business partnership.
In addition, Mazda bases its assessments of business dealings with new suppliers on a comprehensive evaluation that covers not only quality, technical strengths, pricing, delivery time, and management approach but also corporate compliance structures and sustainability initiatives, including environmental protection activities. The Company conducts questionnaire surveys of its suppliers on an as-needed basis, aiming to track and evaluate the status of their implementation of sustainability initiatives in more detail. Also, concerted efforts are underway between Mazda and its suppliers to establish risk management systems that ensure business continuity and stable development so as to avoid a suspension of business that would extensively impact society.
In addition to proactively offering opportunities for communication, Mazda provides support in various forms to suppliers to ensure that the Company can promote sustainability initiatives and risk management in close concert with them.
Basic Purchasing Policy
Mazda will, in the fullest sense of coexistence and mutual growth, 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.
Measures for Supplier Support
- Co-creation and technology exchange with suppliers, aimed at improving their competitiveness
- Cooperating with suppliers in improving their product quality
- Adoption of 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)
- Provision of information on third-party exhibitions and conventions to showcase the latest technologies and manufacturing methods
* A method in which a single truck visits multiple suppliers to collect supplies. Named after truck routes in rural areas, which picked up milk from each farm.
Deployment of the Mazda Supplier Sustainability Guidelines to Suppliers
The Mazda Supplier Sustainability Guidelines have been formulated based on Mazda’s basic approach to sustainability initiatives and with reference to the Supplier CSR Guidelines of the Japan Automobile Manufacturers Association. The guidelines outline sustainability areas and items that are closely related to procurement. In the guidelines, sustainability activities are categorized into six areas: Customer Satisfaction (Safety & Quality), Environment, Social Contributions, Respect for People (Human Rights & Work), Compliance, and Information Disclosure. The Company requests that all Mazda suppliers comply with the guidelines in these areas. In addition, the Mazda Green Purchasing Guidelines have been created to describe the Company’s approach toward environmental protection in more detail, and Mazda requests that suppliers observe these guidelines. The Company also conducts periodic surveys of suppliers to confirm their compliance status.
Customer Satisfaction (Safety & Quality)
Suppliers are requested to abide by the guidelines regarding products and services that meet the needs of consumers and customers, sharing appropriate information about products and services, safe products and services, quality products and services, etc.
Environment
Suppliers are requested to abide by the guidelines regarding environmental management, greenhouse gas reduction, air, water, and soil pollution prevention, resource conservation, waste reduction, chemical management and ecosystem conservation.
Social Contributions
Suppliers are requested to make social contributions proactively and continuously at home and abroad to meet the needs of each region, thereby fulfilling their responsibilities as a good corporate citizen.
Respect for People (Human Rights & Work)
Suppliers are requested to abide by the guidelines regarding abolition of discrimination, respect for human rights, prohibition of child labor and forced labor, non-use of conflict materials, wages, working hours, dialogue with employees, and safe and healthy working environment.
Compliance
Suppliers are requested to abide by the guidelines regarding regulation compliance, competition law compliance, promotion of fair business practices, corruption prevention, confidential information management and protection, export management, and intellectual property protection.
Information Disclosure
Suppliers are requested to disclose information to their stakeholders in a timely and appropriate manner, and make efforts to maintain and develop mutual understanding and trustful relationships with stakeholders through open and fair-minded communication.
Promotion of Fair Business Practices
Compliance: Fair Business Practices
Mazda promotes fair business practices to ensure that both the Company and its suppliers have fair dealings under clear standards with a shared understanding to strengthen their global competitiveness through mutual collaboration. Based on the Guidelines for Appropriate Transactions in the Automobile Industry, which was formulated at the initiative of the Ministry of Economy, Trade and Industry, Mazda carries out various activities, including the formulation of the Promotion Manual for Appropriate Purchasing, education for those engaged in procurement operations at Mazda, and information provision to suppliers through its website and briefing sessions.
In-House Education to Ensure Fair Transactions
The following educational initiatives are conducted for those engaging in procurement operations.
- Education and comprehension tests on promotion of fair business practices (including questions pertaining to the Act against Delay in Payment of Subcontract Proceeds, etc. to Subcontractors)
- Education on financial control
- Posting of guides and process rules regarding fair business practices and compliance on the Company's intranet
- Courses on promotion of fair business practices for employees who were newly assigned to the relevant sections
Supplier Evaluation System
When starting transactions with a new supplier, relevant departments coordinate to confirm the supplier’s quality control system, R&D system, technological capabilities, management conditions, and sustainability initiatives in order to evaluate whether or not the supplier is compliant with the procurement and selection policies of the Mazda Group. For each long-term supplier, Mazda conducts not only an evaluation based on the quality, cost, and delivery time of goods or services produced but also a comprehensive evaluation of the entire business including the quality management system, R&D system, technological capabilities, and the status of its sustainability initiatives. For the supplier quality control system, the Company 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 remote quality auditing in addition to on-site confirmation of actual products at both domestic and overseas sites.
Also, Mazda comprehensively evaluates its suppliers every year from the perspectives of quality, cost, delivery time, and other considerations in order to build more positive business relationships with them. The results of these evaluations are communicated to the suppliers. Outstanding suppliers are recognized with awards. The Company has also introduced sustainability-based evaluations, and has presented special awards to suppliers that have made outstanding proposals on weight trimming, which greatly affects environmental performance.
【Statistics from FY March 2024】
Evaluations conducted targeting 185 suppliers
Evaluation System
Evaluation items when starting business with a new supplier:
Quality management system, research & development system, technological capacity, production and delivery capacity, financial conditions, sustainability initiatives, etc.
Evaluation Items for Continuing Suppliers:
Quality management system, R&D system, technological capabilities, production and delivery capacity, management conditions; quality, cost, and delivery time of goods or services procured; and other items in the Mazda Supplier Sustainability Guidelines
Questionnaire Surveys for Suppliers
Mazda has conducted questionnaire surveys of its suppliers since FY March 2014 with the aim of tracking and evaluating the status of their implementation of sustainability initiatives. The survey results are used to confirm that these suppliers have appropriately implemented sustainability initiatives and established their own sustainability promotion systems. After analyzing these results, the Company conducts individual interviews with companies deemed to be in need of further improvement in order to help them in devising improvement methods. Through these surveys, the Company also checks each supplier’s recognition of the Mazda Supplier Sustainability Guidelines.
【Statistics from FY March 2024】
Compliance (fair business practices) surveys targeting all suppliers
Enhancement of the Business Continuity Plan
From the perspective of risk management, Mazda works together with its suppliers to enhance its business continuity plan (BCP) in order to avoid a suspension of business that would extensively impact society. The Company has introduced SCR (Supply Chain Resiliency) Keeper,* a supply chain risk management system, to accelerate its initial response in the event of a disaster by promptly and thoroughly gathering information on the situation at operation sites. Also, initiatives are underway to promote disaster prevention and mitigation activities related to disasters including earthquakes, landslides, and flooding. Going forward, the Company will continue to work with suppliers to enhance its BCP. In addition, the Company educates suppliers on the threats posed by cyberattacks, which are becoming more commonplace and more advanced, and asks them to promote further-enhanced security. The Company also arranges discussions regarding hypothetical cyberattacks on some of its suppliers to formulate measures for minimizing the impact of such attacks on the production of its materials and components.
* SCR Keeper is a system combining map data with earthquake information from the Japan Meteorological Agency through which the seismic intensity at the registered production sites can be determined quickly in the event of an earthquake.