Procurement

The Bridgestone Group’s sustainable procurement initiatives create long-term environmental, social and economic benefits for stakeholders across its supply chain. This work is guided by its Global Sustainable Procurement Policy that was introduced in 2018 and aligns with its goal of using 100% sustainable materials* by 2050 and beyond. The policy helps identify and evaluate qualified suppliers, promote best practices, and serve as a communication and improvement tool for the industry.

In formulating the policy, the Group paid close attention to international norms and fundamental principles for human rights reflected in a wide range of recognized commitments, including the United Nations Universal Declaration of Human Rights, the UN Guiding Principles on Business and Human Rights, various International Labour Organization conventions, ISO 26000 and 20400 standards on sustainable procurement and social responsibility. Working with suppliers, the goal is to contribute to the faster realization of a sustainable supply chain for the environment and communities around the world.

*The Bridgestone Group defines sustainable materials as materials "1) that come from resources with a continual supply, 2) that can be used as part of our business over the long-term, and 3) that have a low environmental and social impact over the lifecycle from procurement to disposal." For details on sustainable materials, see “ Long-term environmental vision (2050 and beyond): Towards 100% sustainable materials.”

To align with stakeholder expectations, including the Global Platform for Sustainable Natural Rubber (GPSNR) Policy Components that were approved in September 2020, the Group will revise its Global Sustainable Procurement policy. One of the main revisions is the expectation that suppliers promote a carbon-neutral supply chain. This expectation mirrors the Group’s December 2020 update to its long-term environmental target of achieving a carbon-neutral state by 2050 and beyond, along with its target of reducing total CO₂ emissions by 50%^*1 by 2030. The Group also includes new requirements for the enhancement of environmentally responsible procurement and respect for human rights.

1. Baseline year: 2011

Composed of members from around the world, the Sustainable Procurement Working Group formulates and deploys global sustainable procurement policy and plans and confirms the progress of global initiatives and activities, which is then reported to the Global Sustainability Committee and the Global Executive Committee (Global EXCO), which is the highest-level committee involved in the Bridgestone Group business execution.

Since the introduction of the Global Sustainable Procurement Policy, the Group has been aggressively training hundreds of procurement, legal, technical and customer-facing teams, among others across the enterprise.

The Global Sustainable Procurement Policy is distributed to all suppliers. All direct and key indirect suppliers of the Bridgestone Group are required to sign a policy receipt acknowledgement.

As of the end of 2020, acknowledgement rate of the policy has been completed by more than 99% of the Group’s Level 1 and 2 suppliers (see table below for definitions of supplier level).

For several years, the Bridgestone Group has held annual conferences for suppliers to ensure full understanding of its sustainable procurement policy in multiple regions in which it operates. In these annual conferences, the Group has communicated with suppliers on the four foundational elements of the policy, which are Transparency, Compliance, QCD & Innovation, and Sustainable Procurement Practices such as environmentally responsible practices and respect for human rights. In 2020, 147 suppliers, consisting primarily of important suppliers for Bridgestone’s global business and its business in Japan, were invited to the annual online conference in Japan.

Based on the sustainable procurement policy, the Bridgestone Group promotes sustainable procurement and competitiveness working together with suppliers.

To better understand the strengths and vulnerabilities of suppliers, the Group worked with EcoVadis to conduct enhanced environmental, social and governance (ESG) risk assessments of the Group's new and existing major, Tier 1 tire material suppliers. Consistent with the sustainable procurement policy, the ESG issues assessed include energy consumption, water, biodiversity, pollution, waste, customer safety, industrial safety, labor practices, human rights, corruption, bribery, fraud, money laundering, and sustainable procurement.

As of April 2021, 60% of the Group’s Level 1 and 2 tire material suppliers have completed the third-party assessment with EcoVadis. Of suppliers who were reviewed, 64% scored an overall average of 45 or higher, which indicates a commitment to Sustainable Procurement Practices.

The Bridgestone Group’s goal is to increase EcoVadis assessments from 89% as of April 2021 to 95% or more of its spend basis for the Group’s Level 1 direct material suppliers by 2023.

The Group also completed third-party assessments of more than 90% of natural rubber suppliers on a purchase volume basis with EcoVadis in 2020.

The Bridgestone Group uses third-party assessments to quantify suppliers’ environmental and social performance and governance and promote improvements by advising and supporting its suppliers on required solutions.

The Group conducts sustainable procurement seminars once a year in all business regions for certain suppliers based on the sustainable procurement policy and the results of their ESG risk assessments, to help support their efforts to improve ESG activities. In 2019, 65 suppliers attended the seminars in Japan.

Bridgestone Singapore Pte., Ltd. (BSSG) visited more than 100 approved natural rubber factories in 2019 to support quality improvement and enhance traceability and sustainability. During that time, it revisited three suppliers with low scores in the EcoVadis assessment to support their ESG activities. In 2020, the company adapted its activities to the coronavirus (COVID-19) pandemic by moving its face-to-face meetings with suppliers to an online format. This has allowed BSSG to continue its work of enhancing traceability and sustainability in the natural rubber supply chain.

The Bridgestone Group has established the Grievance Mechanism with the aim of further improving the sustainability efforts of its natural rubber supply chain. The Grievance Mechanism supports the intake of grievances brought to us by stakeholders against our natural rubber supply chain and aids solving the issues in cooperation with the direct suppliers and the third party in accordance with our Global Sustainable Procurement Policy. As necessary, the Group will align with the grievance mechanism of the Global Platform for Sustainable Natural Rubber (GPSNR). In order to secure the transparency, the Group will disclose the standard operating procedure, grievance windows, and the status of each grievance on the Group global website below.

For more information, see “Grievance Mechanism.”

Nearly all of the world’s natural rubber is derived from Hevea brasiliensis, a type of rubber tree found primarily in the rain forests of West Africa, South America and Southeast Asia. These forests risk depletion, so to offset its footprint in these regions, the Bridgestone Group provides Hevea rubber trees to smallholders. The Group also provides these smallholders with technical training and productivity-improvement techniques developed on its own rubber farms. Since 2005, the Group has provided more than 370,000 saplings to farmers in Indonesia alone. Worldwide, it has donated 5.6 million budded stumps valued at 2 million USD. In addition, the Bridgestone Group uses genome data to improve breeding technologies and growing methods to make rubber trees more resilient and productive.

In Southeast Asia, where over 90% of the world’s rubber tree plantations are concentrated, white root rot disease is worsening, killing trees by infecting and rotting their roots. It can be difficult to detect, especially in the early stages when treatment is more successful. The Bridgestone Group has developed techniques to diagnose the disease early using satellite imaging and DNA testing, and by examining leaf colors and temperatures.

For more information, see “Enhancing contribution (Procurement).”

Being respectful of local rubber farmers and smallholders is critical to the Bridgestone Group’s commitment to protecting the environment while creating value for the communities where it operates. These efforts help protect the people and places the Group relies on.

On its farms, the Bridgestone Group ensures access to safe and clean water; provides free medical care; operates 26 free schools from kindergarten to 12th grade and employs more than 350 teachers; and has introduced renewable energy sources for sustainable and affordable access to lighting and energy.

To help independent smallholder farmers, the Bridgestone Group hosts Seeding Success to Smallholders workshops in Southeast Asia, providing technical training and productivity improvement techniques developed on its own farms. In 2018 and 2019, hundreds of smallholders participated in sessions to learn techniques such as how to grow quality rubber trees, replanting trees, preventing disease and best practices for tapping trees.

The Bridgestone Group is proud of its sustainability progress but improvements at scale will be achieved through industry-wide collaboration. That’s why the Group and other global tire companies launched the Global Platform for Sustainable Natural Rubber (GPSNR), to transform the industry for the better.

Through the GPSNR, tire companies, including Bridgestone, and other stakeholders are harmonizing standards to improve respect for human rights, prevent land-grabbing and deforestation, protect biodiversity and water resources, improve yields and increase supply chain transparency and traceability.

As a member of GPSNR Executive Committee, in 2020 the Bridgestone Group played a leading role in developing the GPSNR Policy Components, a set of policies on natural rubber sustainability that GPSNR company members commit to practicing in their supply chains, including no land deforestation or conversion, upholding human rights, and transparency, monitoring and reporting. The Policy Components were co-created with GPSNR members through several rounds of consultations.

The Group will continue working with the GPSNR, NGOs, suppliers, customers and others to increase transparency and traceability in the natural rubber supply chain.

In 2020, the Sustainable Procurement Working Group initiated work with World Wide Fund for Nature (WWF), the international conservation organization, to study and develop a due diligence process for ensuring the company’s supply chain is in compliance with its Global Sustainable Procurement Policy, especially in upholding human rights and safeguarding environment. The collaboration aims to strengthen sustainable rubber production and help build the capacity of smallholders.

The Bridgestone Group pursues various initiatives in Japan and overseas to further strengthen the fair procurement activities.

In 2018, the Group launched the Global Code of Conduct which is providing guidance on its commitment to integrity and its expectations for employees worldwide, by explaining the critical role each employee plays in supporting the Group's Mission of “Serving Society with Superior Quality”.

In addition, in Japan, Bridgestone conducts regular surveys on supplier satisfaction and the type and level of fair procurement activities being conducted by the 150 supplier survey participants. Results of the 2020 survey showed that, while the level of satisfaction maintains a high level (90%), some suppliers wanted to see greater improvement in communication.

The Company has adopted a web-based questionnaire to gain a deeper understanding of supplier opinions and desires. The Company is incorporating the voice of suppliers in the way it operates.

As to our Subcontract Act of Japan program, Bridgestone switched to on-demand in 2020 so that participants can attend at their convenience.

Bridgestone has formed an audit team to improve the caliber of fair procurement activities at each Bridgestone Group company by conducting a general audit once a year on procurement and purchasing operations.

The Company has also worked to enhance the audit program and implement a cross-audit program between work sites in Japan. Fifteen Bridgestone work sites in Japan currently participate in mutual auditing with neighboring work sites. This helps the Company enhance its auditing capabilities by training internal auditors to approach auditing from the perspective of both the site undergoing the audit, and the entity conducting it.

The Bridgestone Group’s Sustainable Procurement Policy covers all materials, including conflict minerals (tin, tungsten, tantalum and gold) and cobalt extracted in conflict areas such as the Democratic Republic of the Congo (DRC) and adjoining countries. The Group conducts risk assessments across its supply chain using the Conflict Minerals Reporting Template (CMRT) and the Cobalt Reporting Template (CRT) compiled by the Responsible Minerals Initiative (RMI) alliance consisting of over 380 global corporations and organizations. Bridgestone Group suppliers whose products potentially contain conflict minerals are required to complete and submit the CMRT and CRT annually.

Additionally, the Group has traced 100% of the smelters from which it sources tire-product materials globally. All are compliant with the Responsible Minerals Assurance Process (RMAP), which is certified by RMI.