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Basic Procurement Policy

Basic Procurement Policy

JFE Steel, which strives to be a good business partner for its partners, conducts procurements fairly and sincerely based on mutual understanding and trust in accordance with the JFE Group Standards of Business Conduct and Human Rights Basic Policy and the following Basic Procurement Policy.

1.Ensuring compliance

Compliance, which is at the core of our procurement activities, ensures that we comply with relevant laws and social norms, act in good faith and thoroughly manage all information obtained through procurement transactions. We do not maintain relationships with criminal organizations or other groups that threaten order and safety in civil society and we do not respond to illegal or otherwise inappropriate demands.

2.Providing opportunities for fair competition

Taking a broad global view, we provide fair opportunities to all competitive partners, both domestic and international.

3.Partnerships

We strive to improve our customer relationships based on mutual understanding and trust, and pursue mutual beneficial development as a business partner.

4.Selection of partners

When selecting partners, we base our decisions on economic rationality as well as partners’ thorough implementation of appropriate quality-control and assurance measures covering not only quality but also technology, price, delivery time, supply stability, reliability, business stability and commitment to CSR.

5.Environmentally harmonious green procurements

We are committed to resource conservation and environmental protection in our procurement transactions.

6.Procurements based on CSR

Throughout our entire supply chain, including partners involved in our business, we conduct procurements based on corporate social responsibility (CSR). We also strive to prevent any misleading representation of quality.

CSR Procurement Guidelines for Our Partners

JFE positions CSR as a means to increase both stakeholder satisfaction and corporate value. Furthermore, the company positions environmental protection, safety, disaster prevention and compliance as top priorities that fundamentally impact the company’s survival. Accordingly, we share our understanding of social responsibility with our business partners in order to promote CSR-related initiatives throughout our supply chain. In particular, we ask partners to recognize and actively pursue the following initiatives, which are based on the JFE Group Standards of Business Conduct and Human Rights Basic Policy.

1.Systems to promote CSR

Partners must develop effective CSR-promotion systems that keep employees informed about CSR in order to ensure compliance and the development of corresponding corporate ethics.

2.Compliance and information management

Partners should carry out the following:

  1. Comply with the laws and social norms in the countries in which they operate
  2. Severe relationships with any criminal organization or other group that threatens order and safety in civil society
  3. Comply with laws and regulations for the responsible procurement of minerals and avoid using conflict minerals
  4. Establish and implement systems to properly manage and protect confidential information obtained through transactions

3.Human rights and occupational health and safety

In business activities, partners should respect basic human rights, eliminate all forms of discrimination* and strive to create safe, healthy and comfortable work environments.
* Please refer to JFE Group Human Rights Basic Policy

4.Green procurements for environmental protection

Partners should strive to conserve resources, protect the environment and keep their business activities in harmony with the environment. In addition, they should thoroughly manage their use of chemical substances in products and packaging materials as well as comply with all applicable laws and regulations.

5.Safe and competitive products and services

Partners must always ensure the safety and stable supply of products in terms of competitive quality, price and delivery. In addition, partners should steadily pursue technological development and the enhancement of technical capabilities to continuously upgrade their products and services.

6.Prevention of improper quality practices

Partners must prevent improper actions such as falsification or fabrication of inspection results related to product quality or contractual obligations. In addition, JFE must be notified in advance of any change that may affect the quality of JFE’s products. Moreover, appropriate quality-control and quality-assurance measures should be applied consistently.

7.When non-compliance occurs

Any compliance violation in the course of a partner’s business activities must be reported to JFE immediately. Also, the results of the partner’s subsequent investigation into the cause of said violation(s) and the measures being implemented to prevent any recurrence must be reported to JFE.

Raw Materials Purchasing Policy

JFE Steel Corporation sources raw materials based on the company’s commitment of respecting human rights, complying with all laws and regulations, and protecting the environment in order to develop and operate a sustainable procurement system. To ensure observance of these principles, the company requests that suppliers adhere to the following Business Conduct Guidelines. JFE Steel appreciates the cooperation of suppliers in agreeing to, accepting and implementing these guidelines.

Business Conduct Guidelines

1.Respect for human rights

We recognize the diverse values of individuals, and both respect and support every individual’s human rights pursuant to international laws.

We reject child labor, forced labor, and human trafficking. We do not tolerate inhumane treatment. We do not purchase conflict minerals.

We strive to prevent work-related accidents and related incidents, and create safe and healthy work environments.

2.Legal compliance

We comply with all applicable laws and regulations and social conventions in the countries and regions in which we operate. We do not participate in bribery of governments or public officials and we strive to prevent corruption and bribery.

We engage in fair and free competition and provide stable supplies of high-quality products and services.

3.Environmental protection

We strive to reduce our CO2 emissions and implement other measures to prevent climate change.

We work to prevent air, marine, water, and soil pollution.

We promote resource recycling and energy conservation for the sustainable use of the earth’s limited resources.