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Supply Chain

Supply Chain

 

Basic Policy

Our basic policy is to comply with the laws and regulations of each country in which we operate and to conduct procurement activities in the global markets for all necessary materials and services at an appropriate quality, price, and with delivery schedule based on fair business relationships. In order to tackle social issues such as the environment, human rights and labor, we strive to strengthen our supply chain to be sustainable and ethical to increase our customers’, business partners’, and our own corporate value.

Please refer here for our procurement policy.

Promotion System

We established the Procurement Division as a global organization that promotes sustainable procurement activities. In collaboration with the Business and Production Units, we are working towards optimal procurement activities and the promotion of sustainable, global procurement.

Mid-Term Target for the Supply Chain

In order to realize a sustainable supply chain, we establish a mid-term target as well as a yearly KPI for undertaking initiatives. 

Mid-Term Target (2021 - 2024) 

  1. Obtain a risk evaluation score* below Medium in all key suppliers 
  2. Procure minerals only from RMI-certified smelters following the RMI certification process

    *risk evaluation by RBA-SAQ

2021 KPI

  Activity Target Achievement Rate Target Achievement Outlook
Agreement to Renesas' Supplier Code of Conduct from key suppliers 100% 100%
2 Obtain RBA SAQ responses from key suppliers 100% 31%
3 Conduct conflict minerals investigation following RMI procedures 100% 100%

Educating Procurement Personnel

As part of promoting corporate ethics within the Procurement Division, we conduct various compliance education on topics such as the Renesas Code of Conduct as well for new employees and employees transferring into the team. We also conduct regular education and training for the most recent CSR issues, such as the environment, in order to penetrate and share information inside the team. 

Promoting Sustainable Procurement through Fair and Equitable Transactions

In order to provide high-quality products and services to our customers, we believe it is important to promote sustainability throughout the supply chain, including taking into considerations the environmental, society, safety and security issues. Therefore, we have created the “Supply-Chain CSR Deployment Guidebook” (in Japanese and English) in 2013, which states specific activities and behaviors we would like the partners that make up our supply chain to comply with. We distributed this "Supply-Chain CSR Deployment Guidebook " to approximately 1,200 suppliers worldwide, promoting sustainable practices throughout the supply chain.

This Supply-Chain CSR Deployment Guidebook is in compliance with the “Supply-Chain CSR Deployment Guidebook” established by the Japan Electronics and Information Technology Industries Association (JEITA). We ask all partners within the Renesas supply chain including secondary suppliers and beyond to follow Renesas’ approach to sustainable procurement and ethical values, and to promote activities from this common perspective.

In 2021, we have re-evaluated the contents of the Supply-Chain CSR Deployment Guidebook after joining the RBA and revised them as the "Renesas Supply Chain Code of Conduct", which is available in Japanese, English and Chinese, to promote sustainability throughout the entire supply chain. 

We have received agreements and endorsement from many of our suppliers on the initiatives listed in the Renesas Supply Chain Code of Conduct. So far, we have received endorsement from all of our key suppliers (64 companies in total).

  Number of suppliers  Number of agreed suppliers* Agreement rate
Japan 973 928 95%
North America 16 16 100%
Europe 13 12 92%
China 11 10 91%
Asia Pacific 34 34 100%
Total  1,047 1,000 96%

*Suppliers who we have agreed to take on the initiatives stated in the Renesas Supply Chain Code of Conduct, or companies whose Code of Conduct meets or exceeds the standards of the Renesas Supply Chain Code of Conduct. 

<Initiative criteria which we ask partners to undertake initiatives based on the Renesas Supply Chain Code of Conduct> 

LABOR
  • Freely chosen employment
  • Young workers
  • Working hours
  • Wages and benefits
  • Humane treatment
  • Non-discrimination/non-harassment
  • Freedom of association
HEALTH AND SAFETY
  • Occupational safety
  • Emergency preparedness
  • Occupational injury and illness
  • Industrial hygiene
  • Physically demanding work
  • Machine safeguarding
  • Sanitation, food and housing
  • Health and safety communication
ENVIRONMENT
  • Environmental permits and reporting
  • Pollution prevention and resource reduction
  • Hazardous substances
  • Solid waste
  • Air emissions
  • Materials restrictions
  • Water management
  • Energy consumption and greenhouse gas emissions
ETHICS
  • Business integrity
  • No improper advantage
  • Disclosure of information
  • Intellectual property
  • Fair business, advertising and competition
  • Protection of identity and non-retaliation
  • Responsible sourcing of minerals
  • Privacy
MANAGEMENT SYSTEMS
  • Company commitment
  • Management accountability and responsibility
  • Legal and customer requirements
  • Risk assessment and risk management
  • Improvement objectives
  • Training
  • Communication
  • Worker feedback, participation and grievance
  • Audits and assessments
  • Corrective action process
  • Documentation and records
  • Supplier responsibility

Click here to view the Renesas Supply Chain Code of Conduct.

Understanding Risks within the Supply Chain

At Renesas, we ask key suppliers selected based on 1) the transaction amount, 2) the replaceability and 3) the characteristics of the produced products to conduct self-tests and self-improvements using a self-diagnosis survey (note). 

In addition, when starting procurement from new suppliers, we ask new suppliers to report on the actions they are taking towards the criteria listed in the Renesas Supply Chain Code of Conduct and to agree to undertake the necessary initiatives. 

Furthermore, we use the risk assessment platform provided by RBA to investigate potential risks in all  suppliers on a regular basis. If a supplier is classified as potentially high risk, we ask them to conduct self-tests and self-improvements using a self-diagnosis survey, similarly to key suppliers.
Note: From 2021, we use the RBA SAQ as the self-diagnosis survey.

In 2021, following the revision to the Renesas Supplier Code of Conduct, we distributed a simplified version of the self-assessment questionnaire (SAQ) to all suppliers. We received responses from 878 companies, and no critical risks were identified from the responses we received.

2021 Activities Results

  Simplified SAQ Practical Audits*
Number of participating suppliers 878 companies  12 companies 
Of which, direct materials and outsourced manufacturing suppliers 176 companies  10 companies 

*Total number of audits conducted by Renesas or a third party (including online audits) 

Promotion of Green Procurement

Based on Environmental Policies, Renesas is contributing to realize a sustainable society by providing environmentally friendly products and solutions. To realize such a society, it is crucial to reduce the environmental impacts of the parts and materials used within the products. At Renesas, we promote “Green Procurement” where we preferentially procure environmentally conscious parts and materials from companies that are proactive in environmental conservation.

We ask all suppliers that provide parts and materials used as components of our products, suppliers that provide parts and materials used in our products, suppliers that provide parts and products used in the packaging of our products as well as suppliers that deliver our out-sourced products to comply with the Green Procurement Guideline by clarifying the green procurement standards and stating the aims of the guideline which is to reduce the environmental impact of Renesas products.

Through compliance with Environmental RoHS Directives and conducting surveys of the substances contained in purchased products at Renesas, we are able to confirm that each supplier is making progress in environmental initiatives. In addition, for procuring raw materials used in products, we preferentially purchase from suppliers who actively promote environmental protection, whose products have less environmental impact and contain no hazardous substances. We also actively and preferentially select environmentally conscious products in the procurement of goods such as business goods and IT equipment, based on the information on the environmental impact of those goods. We have confirmed that suppliers that cover over 95% of the total transaction amount of outsourced manufacturing recorded in the second half of 2019 and the first half of 2020 are ISO14001 certified.

Guidelines and Standards

Reference: Green Procurement Answer Format

  • There is no format for "Environmental Hazardous Substance Analysis Data" report. Answers are provided as free-form. (Please refer to "Green Procurement Standard Ver.2")
  • Answers are sent via email with the Excel file attached.

Responsible Minerals Procurement Policy

In order not to contribute to human rights violation and the destruction of environment within the supply chain, Renesas is working to realize responsible mineral procurement with the aim of procuring materials that does not include conflict minerals, from OECD conflict-affected and high-risk areas, in relations to risks listed on the Annex II of OECD’s guidelines. 

Responsible Minerals Procurement Policy

Initiative Framework

Step 1: Establishment of Management System

In 2021, we revised the “Supply-Chain CSR Deployment Guidebook” as the “Renesas Supply Chain Code of Conduct”, based on the RBA code of conduct, and we ask customers to comply with this code of conduct. In addition, internal departments within Renesas work together to establish a structure to identify and evaluate risks.

Step 2: Identifying and Evaluating Risks within the Supply Chain

We work to realize responsible mineral procurement throughout the supply chain by conducting investigations of suppliers to identify smelters using the industrial standard RMI process and disclosing the results to our customers.

Step 3: Establishing and Executing Strategies Against Identified Risks 

As a result of investigation, if an uncertified smelter is identified in the supply chain, we ask suppliers to make revisions. In addition, depending on the improvement status, we review transactions and execute suspensions if necessary. 

Step 4: Annual Updates on Initiatives

The initiatives undertaken are disclosed on our website on an annual basis.

Results

In 2020, we confirmed in an investigation around 3TG that there are 232 smelters of raw materials (minerals) used in Renesas Group’s procured suppliers, and all 232 smelters are listed on RMI’s Conformant Smelter List.

  2019  2020
    Total Tin Tantalum Tungsten Gold
Number of Identified Smelters 253 232 47 37 42 106
Number of Conformant Smelters 253 232 47 37 42 106

Click here for the list of smelters and refiners identified in the Renesas Group supply chain

In addition to 3TG, from 2019, Renesas began monitoring cobalt and began identifying smelters of cobalt within the supply chain. However, because of the lack of regulations, we are facing difficulties in confirming whether the smelters are following the "Cobalt Report Templates (CRTs)" certification from Responsible Materials Initiative (RMI)”.

Reporting of Investigation Results

Our initiatives related to conflict minerals are embedded into Renesas’ sustainability promotion structure, and the initiatives are regularly reported to the Renesas management team by the Sustainability Promotion Office.

Click here for Renesas' Sustainability Promotion Structure 

Renesas Joins the Responsible Business Alliance

Renesas has joined the Responsible Business Alliance (RBA) (announced on April 19, 2021), a nonprofit organization founded in 2004 committed to supporting the rights and well-being of workers and communities worldwide affected by global supply chains. By joining the RBA, Renesas will fully support the vision and goals of the RBA to ensure that its manufacturing processes are environmentally responsible and that its workers are treated with respect and dignity.

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Ratio of Purchase Amount by Region(2019)

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