Honoring the “Supply Chain CSR Action Guidelines” in our Lumber Business
?Sojitz Wood Procurement Policy?
Based on the “Sojitz Group Supply Chain CSR Action Guidelines,” Sojitz set a “Wood Procurement Policy” for responsible wood procurement in September 2015.
Wood Procurement Policy
In honoring the Sojitz Group Statement, we are committed to do our best to cooperate with business partners to procure wood in line with the following policies, based on the Sojitz Group CSR Action Guidelines for Supply Chains.
- 1. Legality
We will not handle wood obtained through illegal logging.
- 2. Environmental Consideration
We will not handle wood obtained through logging methods which are detrimental to high conservation value forests.
- 3. Social Consideration
In view of logging’s potential to adversely impact human rights, we will seek to mitigate any negative impact associated with wood procurement.
This policy covers all roundwood; sawnwood and wood-based panels; paper manufacturing materials such as wood chips, particles, and pulp; paper products; and woody biomass handled by Sojitz and its consolidated subsidiaries (hereafter, “wood.”)
We selected and and conducted a targeted survey of wood that makes up over 80% of our total purchased wood supply in terms of monetary value, using criteria including the supplier country’s risk level1, the amount of wood purchased in terms of monetary value, and suppliers’ compliance with Sojitz policies, from among Sojitz Group’s approximately 1,500 wood-related suppliers. The survey conducted in the 2019 fiscal year found that of the surveyed wood supply, 70% was imported wood, and 30% was produced domestically. We take an approach to surveying that accounts for the unique characteristics of both the import and domestic industries.
- *1：Our country risk evaluation adopts the Corruption Perceptions Index made available by each year by Transparency International, an international, non-governmental organization working to prevent corruption around the world. This index ranks countries individually by comparing levels of corruption among public servants and politicians.
- *2：The Vietnam-based containerboard manufacturing company acquired in the 2018 fiscal year was not included in the survey. This manufacturer will be included in future surveys.
Under the supervision of WWF Japan3, the wood selected for survey was checked for 1) traceability to its country of origin, and 2) suitability of forest management (whether the forest is subject to environmentally/socially-conscious forest management).
- *3：We have adopted use of WWF Japan’s “Responsible Purchasing Checklist for Forest Products” to confirm 1) wood traceability in the country of origin and 2) suitability of forest management. We also invited WWF to hold a briefing session in FY2015 to explain how to confirm whether forests with high conservational value in terms of biodiversity are being appropriately protected, as well as how to define human rights issues. Sojitz's lumber-related departments and subsidiaries attended the lecture. Furthermore, we referred to advice from WWF Japan in establishing the targets below
1) Wood was evaluated for traceability back to the place of origin and 2) suitability of forest management, after which it was sorted into one of the following four levels.
- Level A：Wood confirmed to be certified wood (*4) or which is subject to strict management equivalent to that of certified wood.
- Level B：Wood which has not been certified, but for which we have verified both traceability and suitability of forest management (i.e. that the forest is subject to environmentally/socially conscious forest management)
- Level C：Traceable wood
- Level D：Wood lacking traceabilit
- *4：Wood certified under FSC?, PEFC, etc. FSC?-certified wood is given the highest score.
Sojitz Group is determined to ensure that 100% of the wood we handle is traceable by FY2020.
In the future, we will also aim to ensure that 100% of the wood we handle is produced through suitable, environmentally/socially-conscious forest management.
＝Efforts to Improve＝
If there was a problem in ensuring 1) traceability in the country of origin, we not only conducted a survey based on WWF Japan’s “Responsible Purchasing Checklist for Forest Products,” but also confirmed whether they had local documentation proving traceability. If traceability could not be confirmed using documentation alone, we visited these suppliers directly.
If we were unable to confirm 2) suitability of forest management, we would introduce suppliers to certifications described by our Level A classification or examples of high-level forest maagement equivalent to these certifications, urging these suppliers to address their issues similarly. If they could not meet the standards of Level A, we asked them to amend the situation to where we could confirm that "even if the wood has not been certified, the supplier could be verified for both traceability and suitability of forest management" as stated in our description of Level B.
By conducting traceability investigations before beginning new business transactions, we maintain 100% wood traceability to the place of harvest (zero percent of wood classified as Level D).
The ratio of wood classified as Level B or higher in our supply chain rose to 67%, a slight improvement from the previous year. We also implemented results-oriented initiatives, such as carrying out confirmation and evaluation through due diligence and requesting suppliers to make further improvements, particularly for wood harvested from regions of concern.
- ① Conduct the survey every year, making the results public.
- ② Continue making efforts to ensure traceability of wood products, and do not handle wood products with unclear traceability.
- ③ Conduct due diligence at the place of origin to expand environmentally and socially conscious wood procurement.
（For reference: Sojitz Corporation?s FSC? license code is FSC-C009917.）
Approach to Domestically-Produced Wood
Domestically-produced wood requires awareness of a different set of issues than imported wood, such as labor safety at the place of harvest.
Recently, the demand for domestic wood is increasing in Japan. In order to advance the recycling of forest resources in Japan in the future, we will deepen our awareness of the issues and realities of domestically-produced wood through discussions with stakeholders, and examine appropriate measures that align with the Sojitz Wood Procurement Policy.