SII develops our purchasing activities based on the following Purchasing Policy.

SII uses the Supplier Certification Criteria to select fair business partners and build the CSR framework based on the purchasing supply chain.

Regarding certified suppliers as suppliers of the whole SII Group, instead of a single business unit, we strive to strengthen our partnership with them.

Based on the Supplier Certification System established in FY2004, we certified about 1,600 suppliers in Japan as of the end of FY2010. In FY2010, we nearly completed the revaluation of the suppliers that we certified initially. Now we started certifying suppliers conducting transactions directly with our overseas sites.

SII has prepared a manual outlining purchasing rules and ethics as well as management guidelines regarding purchasing practices. The Purchasing Division now follows this manual as a set of basic rules, and we have issued English and Chinese versions for overseas sites.

The Subcontract Act has a major significance in purchasing activities in Japan.

SII established the Subcontract Act Section in the Head Office to reinforce compliance with the Subcontract Act by cooperating with the SII Group’s purchasing staff through activities including appropriate guidance to daily management operations and education on Subcontract Act.

We have also provided a reporting and consultation service for listening to issues or concerns of all the parties concerned to SII group based on the fair trade perspective.

As a role of purchasing divisions, it is important to minimize the risk in disrupting parts supply. We not only search for alternative suppliers or parts, but check the financial condition of suppliers on a regular basis.

In addition, by defining key parts and comprehending their manufacturing bases, we can promptly handle emergency situations in case of disaster in local area like earthquake. Our risk management proved effective during the Great East Japan Earthquake by checking and dealing with the situation quickly.

Education programs have been provided to employees and managers in purchasing, design, manufacturing and production control divisions to acquire basic knowledge of purchasing operations. In FY2008, the program was enlarged to include overseas employees. The number of employees participating in the education program is over 1,000 in total. The contents of the education have been reviewed for renewal since FY2010 to build and implement a more fulfilling educational system in the future.

The Head Office Purchasing Division carries out audits in accordance with the Purchasing Management Manual. In the audit, we point out issues which must be improved and give guidance for further enhancement.