We strive to create an organization and a corporate culture that place the highest priority on compliance to fulfill our responsibilities and meet the expectations of our customers and society.
Compliance Promotion System
Suntory Group’s Code of Business Ethics: values shared by all employees for the realization of the corporate philosophy
We are building a compliance promotion system to realize our corporate philosophy from a cross-Group view based on the Suntory Group’s Code of Business Ethics established in 2003 that enables all employees to take action according to common rules. We also revised the content by referring to the ISO26000 international standard for social responsibility in 2012 and, adapted the content in 2017 for all Group employees around the world to better understand it.
Promotion System Rooted in the Frontlines
To promote compliance from a cross-Group perspective, the Compliance Department was established under the Risk Management Headquarters to specifically promote compliance.
The Compliance Department must remain aware of all measures formulated and implemented at each workplace and about how those measures conform to policy. In addition to offering advice on specific issues, the Compliance Department set up the Compliance Hotline, and is charged by the Group Risk Management Committee to faithfully investigate and rectify any compliance violations found. We have revised some of the rules for the internal reporting system to operate more effectively under this system following revisions to the Guidelines for Business Operators Regarding the Establishment, Maintenance and Operation of Internal Reporting Systems Based on the Whistleblower Protection Act.
In addition, there are specific personnel responsible for promoting compliance issues at each Group company, both within Japan and abroad. They take an active role in promoting compliance, formulating policy customized for the circumstances in their own company, and informing colleagues about that policy.
Compliance Promotion Structure
Enhancing the Hotline for Early Discovery and Resolution of Problems
The basic rule in Suntory is that when an employee discovers actions that breach the Suntory Group’s Code of Business Ethics, he or she must first report it to the supervisors and seek their advice. However, we have installed a Compliance Hotline both at our Compliance Office and at an external law firm as a common contact point for all of the Group companies in Japan in order to quickly discover and resolve problems when reporting or consulting with a supervisor is not appropriate. In addition, we provide an independent internal contact point at 10 Group companies and conduct annual training to improve the response of those in charge of this independent contact point in the Compliance Department.
We installed a worldwide common contact point for reports encompassing all Group companies in Japan and even overseas as part of our global risk management system in April 2016.
In 2017, a total of 214 reports were received through these contact points at each Group company in Japan and overseas (104 reports were received by Suntory Beverage & Food Group). Roughly 70% of the reports received in Japan were about labor, personnel and management issues. We work to resolve the raised concerns and prevent them from reoccurring by implementing corrective measures and recommendations based on the investigation results, while making sure that the confidentiality of involved persons is protected by the Compliance Department and relevant departments in charge at each Group company.
Protecting People Who Report Issues
Simultaneously with establishing the hotline, the Suntory Group formulated the rules that prohibit disadvantageous treatment of employees who report issues. Furthermore, we have established an internal reporting system to thoroughly protect people who report an issue such as restricting unfair handling for not only the people who report an issue but also for people cooperating in investigations. We follow up with the person who reports an issue after the issue has been resolved.
Compliance Hotline Response Flow
Activities to ensure compliance
Communicating the Code of Business Ethics throughout the Group
To facilitate the understanding of the Suntory Group Philosophy and Code of Business Ethics and put them in practice, we distribute a pamphlet to all Suntory Group officers and employees.
At the start of each year, every employee of the Group companies in Japan refreshes their understanding of the Code, and then signs a compliance statement at the end of the pamphlet. At the same time, workplace discussions regarding various compliance related cases that occur in the society, subjects that are recognized as issues in the Group and individual companies, and other topics are held to remind the fundamentals of compliance and promote ethical behavior.
In employee awareness surveys conducted for Suntory Group employees in Japan, we were able to verify our businesses and offices run in accordance with Suntory Group’s Code of Business Ethics as well as confirm the status of compliance practices. Suntory strives to discover any potential compliance breaches by reporting the results of these surveys to management while regularly ensuring the effectiveness of Suntory Group’s Code of Business Ethics and taking advantage of these results in efforts that include education for employees and the formulation of activity plans.
Activities to Raise Compliance Awareness through Communication
We put out periodic information on the Compliance Net internal intranet to promote and practice true compliance.
We distribute information on the Compliance Net that includes activities and themes linked to activities which are being undertaken as well as information to understand the true nature of compliance with examples found throughout the world. We raise the awareness of every employee through the activities of compliance promotion managers in each company. In addition, we publish information that promotes the basic knowledge of compliance, harassment checks, and a collection of materials for self-study in order to make learning accessible at any time on the Compliance Net.
Furthermore, we conducted compliance seminars through external instructors for management of business firms which confirmed the readiness to prevent scandal by thinking about a business environment where scandal is present in 2017.
Supporting Promotion Activities at Group Companies
Each Group company is engaged in activities around their promotion managers. The Compliance Department provides suggestions and tools tailored to the challenges of each company, implements group training and offers other measures of support. In addition, we have introduced research to more deeply recognize our role as the driving force of compliance management for directors and managers who are newly appointed at Group companies in Japan.
Insider Trading Prevention Systems: Implementation and Communication
The Legal Department of the Risk Management Headquarters of Suntory Holdings Ltd. and the management headquarters of Suntory Beverage & Food Ltd. are working to comprehensively prevent insider trading by introducing e-Learning based on the content provided by the Tokyo Stock Exchange, as Suntory Beverage & Food Ltd. and Dynac Corp. are listed on the Tokyo Stock Exchange.
Implementing the Suntory Group’s Code of Business Ethics in Business Activities
We have clarified our emphasis on compliance in the Code of Business Ethics. Each department has set and is operating policies and voluntary standards for challenges related to various compliance in their business activities based on the concepts of the Code of Business Ethics.
Ensuring Fair Business Practices
The Suntory Group conducts business fairly, holding integrity as a prerequisite, and abides by all laws and regulations, including the Antimonopoly Act. We have revised and are running operations under policies in-line with legal revisions and environmental changes since the formulation of the Guideline for Compliance of the Antimonopoly Act in 1992. Further compliance is being ensured through the posting of our Key Points for the Promotion Campaigns under the Act Against Unjustifiable Premiums and Misleading Representations and our Compliance Manual for the Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors, to Subcontractors to the Intranet.
We spread the word about the Antimonopoly Act and related legislation through the implementation of regular seminars in each division and Group company, and ensure fairness in our daily transactions with business partners and customers. We actively engage with various departments to ensure that compliance policies and activities are implemented in all stages starting from product development, sales and marketing planning.
Establishing Committees to Promote Fair Business for Alcoholic Beverages
A Fair Trade Promotion Committee was established to promote fair business practices at Suntory Liquors Ltd., the Suntory Group company responsible for the sale of alcoholic beverages. This was done in keeping with the Fair Practice Guidelines for the Liquor Business* and to maintain compliance with laws and regulations specific to alcoholic beverages as well as internal proprietary standards.
*The Fair Practice Guidelines for the Liquor Business are administrative guidelines established by the National Tax Agency in 2006. These guidelines prevent worsening of management of liquor business operators and the reduction of liquor taxes due to dumping caused by excessive competition. We set fair partnership conditions and make rebates more transparent to stabilize management of liquor business operators. This is also coordinated by Fair Business Committee responsible for overseeing the Antimonopoly Act.
Transparency of Business Dealings and Prevention of Bribery
The Suntory Group’s Code of Conduct prohibits the provision of excessive business entertainment and gift-giving to any counterpart regardless of whether it is a corporate entity, individual, political or governmental entity, or any other related organization or company, and establishes that relationships with all parties should comply with laws and be fair and transparent.
We are in the process of creating the Suntory Group Common Action Guidelines that will indicate policy for practical actions and decisions that must be taken in the course of normal business relationships and situations that might arise on a daily basis. These guidelines are posted on the intranet so that all executives and employees at each Group company in Japan can refer to them.
Global Compliance Initiatives
We work to build a global compliance promotion system and integrate global standards due to the global expansion of the Suntory Group. In 2015, we formulated the guidelines on business entertainment and gift-giving that are aligned with global standards, and we provide seminars and e-Learning courses on the prevention of bribery and all types of corruption comprehensively to raise the awareness of employees on corruption issues as our response to global enhancement of anti-corruption regulations, such as the Foreign Corrupt Practices Act (FCPA). We have formulated a global Anti-Bribery Policy in 2016, which includes new provisions on donations and political contributions in addition to entertainment and bribery. We started expanding e-Learning even at Group companies overseas in 2017. In April 2016, we have established global hotline contact points to handle reports on bribery and all types of corruption comprehensively, as well as human rights violations and other compliance breaches. These contact points are available at all overseas Group companies as part of our global compliance system. There were no reports through the global hotline in 2016. Moreover, there were no reports on child or forced labor.
Employee Awareness Survey to Understand the Awareness Towards Compliance and the Organizational Culture
To understand the status of compliance and the organizational culture as well as to determine if there are any individual issues, we conduct awareness surveys for all Group employees in Japan. We investigate initiatives to promote awareness of compliance through the entire Group by understanding the challenges in each company and each department from these results. We share the discovered challenges with directors and managers at each company, and expect that related departments in these companies will take voluntary actions to resolve these challenges.
Overseas Group companies contribute to compliance management by conducting their own independent surveys.