Procurement

In early 2018, the Bridgestone Group introduced its Global Sustainable Procurement Policy to help identify and evaluate qualified suppliers, promote best practices, and serve as a communication and improvement tool for the industry.

In formulating the policy, we 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, our goal is to contribute to the faster realization of a sustainable supply chain for the　environment and communities around the world.

We work toward realizing the Group's goal of using “100% sustainable materials*” in our products as the long-term vision by 2050 and beyond.

*The Bridgestone Group defines sustainable materials as materials "1) that come from resources with a guaranteed 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."

Since the introduction of our sustainable procurement policy, we have been aggressively training hundreds of procurement, legal, technical and customer-facing teams, among others across the enterprise.

In 2018, we issued the policy to 100% of our Level 1 and 2 suppliers while Level 3 suppliers will be focused on during early 2019 (see table below for definitions of supplier level). As of May 2019, acknowledgement of the policy has been completed by 98 percent (~2,400) of the Group’s Tier 1 major suppliers and the majority are in the process of completing third-party assessments with EcoVadis. As of May 14th, 2019, 424 (41 percent) of the Group’s Tier 1 tire material suppliers have completed the full assessment.

The Bridgestone Group’s work with EcoVadis aligns with broader, industry-wide initiatives. In 2019, we are focusing on reviewing assessment findings, addressing immediate concerns and developing go-forward strategy toward industry best practices for supply chain sustainability and transparency. We intend to establish subsequent targets based on the survey results and potential input from third-party agents.

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 CSR Enhancement Committee (GCEC) and the Global Executive Committee (Global EXCO), which is the highest-level committee involved in the Bridgestone Group business execution.

The Bridgestone Group pursues sustainable procurement through a Supply Chain Partnership Development System framework, which is designed to improve the overall competitiveness of the Bridgestone Group and its business partners.

We conduct risk assessments of both new and existing suppliers on Environmental, Social and Governance (ESG) issues^*1 using third-party assessors. We use these assessments to help quantify any ESG issues and promote improvements by advising and supporting our suppliers on required solutions.

The Green Partner Award was introduced in 2013 to recognize suppliers’ environmental activities. This award commends activities that help reduce environmental footprint and result in environmental contribution, and best reflect the Group’s Environmental Mission Statement themes: “In harmony with nature,” “Value natural resources” and “Reduce CO₂ emissions.” Sanyo Chemical Industries, Ltd. won the Green Partner Award in 2018.

For several years, the Bridgestone Group has held annual conferences for suppliers to ensure full understanding of our sustainable procurement policy in multiple regions in which we operate. In 2018, 138 suppliers attended the annual conference in Japan, and 20 suppliers attended the conference in Thailand.

We also conduct CSR seminars for certain suppliers based on the results of their CSR assessment, to help support their efforts to improve CSR activities in all business regions. In 2018, 131 suppliers attended the seminars in Japan.

We also hold annual conferences to deepen understanding of our procurement policies among our natural rubber suppliers in various locations. In addition to these conferences, representatives from the Group visit approved natural rubber factories and hold face-to-face meetings once a year to support quality continuous improvement and enhance traceability and sustainability initiatives.

We are evaluating traceability pilots based on our sustainable procurement policy criteria, and are promoting full future standardization of natural rubber industry practices and sustainable policies according to best practices to be established by the new Global Platform for Sustainable Natural Rubber (GPSNR).

Partnerships

Although the Bridgestone Group’s commitments are significant, we cannot address supply chain improvements alone. That is why we are working collaboratively with 10 other leading tire companies that represent 65 percent of the world’s tire manufacturing capacity through the global Tire Industry Project (TIP) operated under the World Business Council for Sustainable Development.

TIP members are using a scientific approach to continue to improve the sustainability efforts of the industry. They are also building on the existing body of knowledge to address the lifecycle impact of tires.

Together with other stakeholders, TIP members recently launched the Global Platform for Sustainable Natural Rubber (GPSNR) to transform the natural rubber supply chain for the better. Through the GPSNR, TIP companies, including Bridgestone and other stakeholder members, will work to harmonize 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.

Even with these partnerships, it is important to realize that the majority of natural rubber production in the world is conducted by smallholder rubber farmers in Southeast Asia. The Bridgestone Group uses large volumes of natural rubber, but unfortunately, productivity of the rubber trees raised by these farmers is often low and the quality of natural rubber produced varies. To help smallholder farmers improve the quality of their operations, the Bridgestone Group provides Hevea rubber tree seedlings and conducts technical training in key producing countries using the same productivity-improvement techniques the Group developed for our own rubber farms.

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

Bridgestone conducts educational programs at 12 major Group companies in Japan on the Subcontract Act of Japan, which relates to the Anti-Monopoly Act. We also utilize an e-learning program to help participants gain a better understanding of the law.

Since 2012, the Group has held on-site education programs to raise understanding of purchasing compliance among members of relevant administration departments. In 2018, 1,751 employees participated, including one who commented “My overall understanding has deepened, and I understand what actions I must never engage in while doing my job. This was very useful.”

In addition, Group companies in Japan conduct regular surveys on supplier satisfaction and the type and level of fair procurement activities being conducted by the 100 supplier survey participants. Results of the 2018 survey showed that while the level of satisfaction maintain high level (88%), some suppliers wanted to see greater improvement in communication.

We have also worked with external research specialists to conduct on-site interviews with suppliers to gain a deeper understanding of supplier opinions and desires. We are incorporating those findings into procurement department employee training to improve specified targets in this area.

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

We have also been work 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 us enhance our auditing capabilities by training internal auditors to approach auditing from the perspective of both the site undergoing the audit, and the entity conducting it.

Our sustainable procurement policy covers all materials, including conflict minerals extracted in conflict zones and used to perpetuate fighting. We include “Respect for fundamental human rights” as a CSR requirement in our sustainable procurement policy. We expect our suppliers to understand our policy of procurement in a manner that complies with human rights, taking into account the human rights issues associated with the procurement of conflict minerals.

We conduct risk assessments across our whole supply chain using the Conflict Minerals Reporting Template (CMRT) compiled by the Responsible Minerals Initiative alliance of over 350 global corporations and organizations.

All smelters from which Bridgestone sources tire product materials are compliant with the relevant CFSI Conflict-Free Smelter Program.