Implementation of Fair, Free, and Transparent Transactions
With a basic policy centered on the three principles of openness and fairness, partnership, and relationship with society, the NGK Group is engaged in fair and honest business transactions with the procurement partners in our supply chain.
The NGK Group has established the Basic Purchasing Policy in an attempt to conduct fair and honest business transactions and to prosper together with all our procurement partners.
Fair and Honest Procurement Partner Evaluations and Extensive Resource Diversification
In accordance with the Basic Purchasing Policy, NGK selects procurement partners based on fair and honest evaluations. We also attempt to ensure procurement when disasters occur through the extensive diversification of procurement resources.
Selection of Suppliers Based on Fair and Honest Evaluations
NGK opens its doors to a wide range of procurement sources, including companies with which it has had no previous transactions.
In terms of selecting new suppliers, we choose from multiple companies through fair and honest evaluation of their CSR initiatives, environmental conservation efforts, and financial condition as well as quality, cost, and delivery (QCD). In addition to the procurement department being involved in the selection of suppliers, multiple departments are also involved in this process, which requires multi-stage approval before selection occurs in an effort to ensure fair and honest evaluation and decision-making.
Promoting Business Continuity Planning (BCP) through the Diversification of Procurement Resources
In the event of unforeseen circumstances such as a major natural disaster, NGK promotes the sourcing of raw materials, equipment, secondary materials, and other critical purchased parts from multiple suppliers as part of its BCP efforts to ensure procurement is uninterrupted. For items which are available from only one supplier, we are in the process of ensuring sufficient inventory and that the storage facilities for these items are located in a safe place that cannot be damaged by tsunami. In addition, when selecting a new procurement partner, we take into consideration the existence or absence of multiple locations and efforts to ensure inventory.
Promotion of CSR Procurement
In response to the rising social expectation for CSR-oriented supply chain management, the NGK Group promotes CSR procurement. We preferentially select CSR-conscious companies and purchase CSR-sensitive raw-materials and services.
CSR Procurement Guidelines
The NGK Group created the CSR Procurement Guidelines in fiscal 2010 as a guide to promote CSR procurement across the Group including overseas Group companies.CSR Procurement Guidelines
Procuring Resources and Raw Materials Responsibly
The NGK Group conducts procurement activities that consider impacts on regional communities stemming from the use of raw materials (e.g. conflict minerals*) with the potential to cause social issues such as human rights violations and poverty, and takes steps to avoid using such materials when there is risk of adverse impact.
*Minerals including tin, tantalum, tungsten, and gold produced in the Democratic Republic of the Congo and surrounding countries, and used as a source of funding for armed conflict in the area.
Improving CSR Procurement
At the NGK Group, we develop activities to promote CSR procurement, such as visiting individual suppliers and conducting on-site inspections. We also request our suppliers, particularly new companies, to sign an agreement to comply with the CSR Procurement Guidelines. From fiscal 2016, we ask for annual renewal of the agreement in an effort to facilitate suppliers' awareness and understanding of CSR procurement while striving to increase the number of signers.
We will continue with these efforts, confirming partners' activities and keeping up with social trends, in order to maintain and enhance our CSR procurement.