Suntory Group considers respect for human rights to be a fundamental responsibility as a global company and essential to our business activities. Under the Suntory Group Human Rights Policy, To ensure that the human rights of everyone involved with our business activities are respected, in line with, we are committed to respecting the human rights of all individuals involved in our business. We engage in dialogue and collaboration with various stakeholders, including employees, business partners, local communities, and NGOs, to further strengthen our existing initiatives.
Our Policies and Approach
Formulation of the Suntory Group Human Rights Policy
In 2019, Suntory Group formulated the Suntory Group Human Rights Policy, based on business-specific key issues identified through dialogue with external human rights experts. Since then, we have continued to advance our activities to address important human rights issues, incorporating ongoing feedback from external experts obtained through dialogue. In 2024, to further promote respect for human rights, we revised the Suntory Group Human Rights Policy. As Suntory Group’s highest-level guidance for human rights, this policy clearly declares Suntory Group’s commitment to respecting internationally recognized standards for human rights, including the United Nations’ International Bill of Human Rights and Guiding Principles on Business and Human Rights, as well as various labor standards (including the International Labour Organization’s core labor standards: freedom of association and the right to bargain collectively, abolition of forced and child labor, and elimination of discrimination in employment). This policy also positions respect for human rights as a priority area among issues to be addressed by the Group. Policy formulation and revisions are carried out with the approval of the Board of Directors, and the Policy has been translated into nine languages spoken in countries where the Group does business. All company officers and employees are made aware of the Policy through e-learning and the company intranet.
Internally, we also promote further understanding of the Suntory Group Code of Business Ethics. Externally, we encourage suppliers and other business partners to understand the Suntory Group Human Rights Policy. We also distribute copies of the Suntory Group Partner Guidelines, which include our requests and expectations relating to human rights and request that suppliers and partners confirm their agreement with these Guidelines.
Furthermore, we are introducing clauses in our vendor contracts requesting business partners to support our efforts to respect human rights, and are engaged in activities to promote respect for human rights throughout our value chain.
Human Rights of Vulnerable Populations
As a corporate signatory to the UN Global Compact, Suntory Group has declared its commitment to respecting international human rights principles such as the Women's Empowerment Principles, the Children's Rights and Business Principles, and the International Convention on the Protection of the Rights of All Migrant Workers and Members of their Families, and promoting the protection of the rights of vulnerable populations (such as women, children, migrant workers, etc.) within throughout our company and value chain. We also expect Suntory Group business partners to undertake similar efforts to respect the human rights of vulnerable groups.
Moreover, Suntory Group also considers it crucial to protect land tenure, water access rights, and the rights of indigenous peoples, and we have declared that we will respect these in accordance with international standards of the Voluntary Guidelines on the Responsible Governance of Tenure of Land, Fisheries and Forests in the Context of National Food Security (VGGT), the IFC's Performance Standards, and the ILO Indigenous and Tribal Peoples Convention (No. 169). Furthermore, we expect Suntory Group business partners to do the same, including respect for ILO labor standards.
Additionally, we understand the important role played by human rights defenders, and regard them as stakeholders with whom we can collaborate in promoting human rights due diligence. We do not tolerate any discrimination or violence of any kind toward human rights defenders, and we require the same commitment from our suppliers.
Suntory Group Migrant Worker Employment Guidelines
Regarding migrant workers, who are vulnerable to forced labor, in February 2023 we established the “Suntory Group Migrant Worker Employment Guidelines,” an internal policy that gives guidance to our relevant departments as well as suppliers and business partners on how to prevent risks from materializing, and also how to provide remedy based on the IHRB’s “Employer Pays Principle” in the case that risks have materialized. These guidelines define the main issues that migrant workers might face and specify the steps that can be taken in response.
<Key Points from the Migrant Worker Employment Guidelines>
-
(1)The Guidelines specify the main issues facing migrant workers, including vulnerability to being made to bear recruitment costs and related expenses, to issues relating to retention of ID documents, etc., and to issues relating to the provision of suitable housing. They also explain the steps that should be taken in response.
-
(2)The Guidelines clearly enunciate the principle that no worker should be required to pay for a job, i.e., the costs and fees relating to recruitment and arranging jobs (as defined by the ILO) should not be borne by the worker.
Suntory Group is working to enhance awareness of potential risks relating to migrant workers by sharing the “Suntory Group Migrant Worker Employment Guidelines” with key internal divisions and with relevant suppliers and business partners, and is working to ensure that these risks do not become actualized, and that appropriate measures are implemented speedily to minimize their impact if they do become actualized. Based on these Guidelines, we are leveraging the Sedex and SMETA management processes (including several checkpoints regarding labor practices in relation to migrant workers) and implementing monitoring, to prevent the charging of fees to workers in the supply chain.
Promotion Structure
The Human Rights Working Team, which consists of the sustainability, supply chain, human resources, legal, compliance, and other functional divisions, as well as major operating companies, serves as the driving force behind activities to promote human rights due diligence, regularly formulating strategies and monitoring the progress of activities. The team reports to the Global Sustainability Committee and, as necessary, to the Board of Directors. The Board of Directors receives regular reports on key issues and progress with regard to human rights due diligence to fulfill its responsibilities to oversee these efforts. The Global Sustainability Committee met twice, in February and April 2024, to discuss items such as the Group-wide human rights due diligence report, and revision of the Human Rights Policy. The committee also consulted with external experts and human rights NPOs, and took their opinions into account in internal discussions.
With respect to daily operations, the Human Rights Working Team holds monthly discussions to promote human rights due diligence, including the sharing of information on human rights inside and outside Japan, identifying and responding to human rights violations risks throughout the value chain and carrying out awareness-raising activities. To further deepen our human rights due diligence policy and plans, a Global Human Rights Working Team was established in each Group company outside Japan. Consisting of human rights representatives from the human resources, legal, compliance and procurement divisions in each company, teams meet about twice a year to share information about their activities and discuss human–related issues. The Chief Sustainability Officer (CSO) is responsible for human rights-related activities, and activities relating to relevant themes, such as child labor and forced labor, are included in CSO compensation criteria to incentivize their promotion.
Integration with Corporate Risk Management
The Global Sustainability Committee assesses human rights risks as a top-priority issue in our corporate management in cooperation with the Global Risk Management Committee, which is in charge of risk management for the entire Group, and regularly engage in information sharing and discussions about corporate risk management. We also collaborate and communicate with outside experts, such as lawyers specializing in human rights.
The discussions of the Global Sustainability Committee and Global Risk Management Committee are reported to the Board of Directors as appropriate. In addition, we respond to Japanese traditional human rights issues through our Human Rights Education Promotion Committee, which consists of a central committee and Human Rights Promotion Committee members from each business location.
Promotion Structure
Due Diligence Process
Suntory Group’s Human Rights Policy identifies key themes such as forced labor and human trafficking, child labor and dangerous or hazardous work for young workers, discrimination, and foreign and migrant workers’ rights, and we promote human rights due diligence globally.
Due Diligence Process
Using the United Nations Guiding Principles on Business and Human Rights (UNGPs) as a framework for implementation, we comply with relevant laws and regulations in each country or region where we operate and conduct human rights due diligence in own operations and value chain under the following processes.
Identifying Stakeholders
We believe that identifying and engaging stakeholders is important in promoting human rights due diligence. Stakeholders mentioned here include rightsholders, as well as other related stakeholders (NGOs / NPOs, experts, etc.). We have discussed with external human rights experts to identify our key stakeholders in consideration of our business structure. These key stakeholders are:
-
(1)Our employees, outsourced manufacturing employees, and the local community around the plants.
-
(2)Our business partners’ employees (suppliers, farms), the local community around our business partners’ plants and agricultural fields.
-
(3)Investors, benchmarking organizations
-
(4)NGOs, experts
-
(5)Customers
Assessment
Identifying Human Rights-Related Risks
The process of formulating the Suntory Group Human Rights Policy involved understanding the characteristics of our supply chain, particularly our own plants and the agricultural products from which our products are made, while leveraging information from a variety of external human rights-related reports. We also engaged in dialogue with human rights experts, and positioned issues that are important in our global business activities as key human rights themes to be addressed by the Group (and listed in the Policy). In implementing our business activities, we are promoting risks assessment internally and in our supply chain, focusing on these priority human rights themes.
To ensure that Suntory Group constantly maintains an up-to-date awareness of global human rights risks, we are engaging in periodic dialogue with NPOs and with human rights experts from the UN, and the fruits of this dialogue are reflected in our human rights due diligence strategy.
We are also strengthening our risk identification process by using risk data from the global consulting firm Verisk Maplecroft.
When a risk assessment shows, for example, that a raw material (coffee, sugar, etc.) or region has a high risk of child labor or forced labor, we prioritize on-site visits and support preventive and mitigating measures.
Assessing Human Rights Risks
To manage human rights risk in the supply chain, we assess risk for both existing and new suppliers by making use of Sedex's SAQ and risk assessment tools, SMETA information, and third-party interviews. These assessments take the geographic, economic, and social considerations into account, and incorporate the perspectives of the different regions and rights-holders that are prone to specific human rights risks. Based on this information, we promote detailed evaluation through interviews with migrant workers, etc. and corrective actions on key findings at suppliers, starting from high-risk areas/issues.
【Risk Assessment】
● Internal Operations
To promote risk assessment as a part of our human rights due diligence process, we have conducted a potential risk assessment in collaboration with Verisk Maplecroft, a global risk consulting company, for the countries in which our global total of 90 factories are located, using general country and industry data. The results obtained through this assessment indicated that, of the countries in question, countries that have a high risk of child labor and forced labor where we have plants were: India, Vietnam, Mexico, Thailand, and Malaysia. Going forward, we will carry out individual evaluations targeting those factories located in high-risk areas.
| Low risk: | 61 factories | 68% |
| Mid risk: | 21 factories | 23% |
| High risk: | 8 factories | 9% |
| Very high risk: | 0 factories | 0% |
-
*Covered human rights risks: child labor, forced labor, working hours, fair wages and welfare, discrimination, harassment, freedom of association and right to collective bargaining, access to remedy, health and safety
● Supply Chain
In order to promote risk assessment as a part of our human rights due diligence process, we have conducted a potential risk assessment in collaboration with Verisk Maplecroft, a global risk consulting company, for our major ingredients using general country and industry data. (major ingredients × country combinations for a total of 124 patterns)
| Low risk: | 21 items | 17% |
| Mid risk: | 58 items | 47% |
| High risk: | 37 items | 30% |
| Very high risk: | 8 items | 6% |
-
*Covered human rights risks: child labor, forced labor, working hours, fair wages and welfare, discrimination, harassment, freedom of association and right to collective bargaining, access to remedy, health and safety
The results of this potential risk assessment showed that the following items had very high risk and very high potential impact (in terms of being items where procurement volume is high) from the perspective of child labor and forced labor.
Forced labor : coffee, oolong tea, ethanol, and sugar
Child labor : coffee and sugar
Going forward, we will start with items that are very high risk and very high impact in terms of child labor and forced labor, and conduct impact assessments to understand the actual situation.
【Impact Assessment】
● Internal Operations
Impact Assessment at Own Plants
We are using Sedex in order to visualize human rights risks and strengthen management at our own plants. We are assessing the management capability in relation to potential risks in 4 categories: (1) labor practices, (2) health and safety, (3) business ethics, and (4) environment.
| Potential risks | Management capability | |||||
|---|---|---|---|---|---|---|
| High | Medium | Low | High | Medium | Low | |
| Japan | 0 | 2 | 18 | 20 | 0 | 0 |
| India | 0 | 1 | 0 | 1 | 0 | 0 |
| Mexico | 0 | 1 | 0 | 1 | 0 | 0 |
| Malaysia | 0 | 1 | 0 | 0 | 1 | 0 |
| Vietnam | 0 | 6 | 0 | 1 | 5 | 0 |
| Thailand | 0 | 2 | 3 | 5 | 0 | 0 |
| Philippines | 0 | 0 | 1 | 1 | 0 | 0 |
| Taiwan | 0 | 1 | 0 | 1 | 0 | 0 |
| New Zealand | 0 | 0 | 1 | 1 | 0 | 0 |
| France | 0 | 3 | 2 | 4 | 1 | 0 |
| Spain | 0 | 2 | 1 | 1 | 2 | 0 |
| United Kingdom | 0 | 5 | 2 | 1 | 6 | 0 |
| Ireland | 0 | 1 | 1 | 0 | 2 | 0 |
| Canada | 0 | 1 | 0 | 0 | 1 | 0 |
| United States | 0 | 5 | 0 | 0 | 5 | 0 |
As shown in the figure above, of the 60 factories, 37 factories had "high" management capability, 23 factories had "medium" management capability, and no factory had "low" management capability toward the potential risks.
Particular attention was paid to confirming the situation in regard to child labor and forced labor, which we consider to be important human rights risks.
- Child labor
While there were no cases of workers under the age of 15, there were two factories with workers under the age of 18, so we are working to confirm to the actual situation regarding labor. - Forced labor
We have confirmed that there are several migrant workers in 21 of our plants overseas. We are currently working to assess the situation in line with the Migrant Worker Employment Guidelines.
For factories with lower management capability, we will continue to strengthen management of important human rights risks. From next year onwards, we will be making effective use of Sedex to help realize sustainable management.
● Supply Chain
Suntory Group is working to promote activities for respecting human rights throughout the entire supply chain while linking to business partners by establishing the Basic Policy on Sustainable Procurement.
Impact Assessment by Sedex
We joined Sedex in June 2019, and since then we are requesting our suppliers to share information through Sedex by answering to the SAQ*. These SAQs evaluate the potential social risks in the supply chain by focusing on child labor, forced labor and other human rights issues as well as considerations toward the work environment and occupational safety. As of December 2024, we have confirmed that over 1,200 manufacturing sites of approximately 800 major suppliers have joined the Sedex. We will continue to promote all major suppliers to join the Sedex. We will prioritize the strategy for each region based on the result of the risk assessment to formulate an action plan and promote corrective actions when needed.
-
*SAQ:Self-Assessment Questionnaire
Impact Assessment Status
Suntory Group identifies potential and actualized risks using a risk assessment tool offered by Sedex. Specifically, we evaluate the ability to manage potential and actualized risks of the suppliers with SAQ. In addition, we also confirm actualized risks based on third- party audit information that can be checked on Sedex.
Potential Risks of Suppliers
Sedex revamped its SAQ in October 2023. We continue to conduct evaluations through the new Sedex SAQ, with the number of manufacturing sites for which we were able to conduct potential risk assessments reaching 1,075 (down nine from November 2023).
| December 2024 | Reference benchmark: November 2023 | |||
|---|---|---|---|---|
| Low | 218 | 20% | 301 | 28% |
| Medium | 687 | 64% | 623 | 57% |
| High | 116 | 11% | 78 | 7% |
| Waiting for answer | 54 | 5% | 82 | 8% |
| Total | 1075 | 1084 | ||
- *SAQ questions were revised in October 2023, so 2023 ratings are for reference only.
Actualized Risks of Suppliers (As of December 2024)
The total number of non-compliances identified was 544.
Monitoring through Supplier Assessment Questionnaires
We also conduct sustainable procurement questionnaires targeting suppliers that have not joined Sedex. We examine not only our existing suppliers to identify those that are at high risk, but also assess potential new suppliers before we start business relationships.
In addition, the Suntory Group shares the Suntory Group Partner Guidelines with our overseas Group companies and verifies initiatives toward sustainability at each company at the Global Procurement Conference in which our overseas Group companies participate.
Conducting Human Rights Due Diligence Related to Migrant Workers
In line with advice from international experts that we received during Group-specific dialogue hosted by Caux Round Table Japan (CRT) in 2019, we are assessing the labor conditions of migrant workers regularly, including that of foreign technical intern trainees, which are a particularly vulnerable type of rightsholder in Japan. We engaged CRT to conduct third-party human rights impact assessment interviews at the Tsuzuki and Takatsu Plants of Izutsu Maisen Co., Ltd., a Group company that hires foreign technical intern trainees. Interviews were conducted in 2024, following on interviews in 2021. Taking into consideration that all interviewees were non-Japanese females, we identified particularly important human rights risks that could arise in the interview context, and conducted direct interviews in a way that allowed rightsholders to freely express their opinions with total anonymity.
As a result, CRT Executive Director Hiroshi Ishida commented, “The relationship between foreign workers and Japanese employees is good at both plants, which are aware of the need to position foreign workers as important strategic assets, and provide them with good treatment.” In addition, the assessment found no significant negative human rights impacts on foreign intern trainees, such as being forced to work long hours, non-payment of wages, or working under hazardous conditions. Comments received, such as those regarding knowledge of evacuation procedures and of the content of employment contracts, will be reviewed with the goal of making improvements.
Aiming to further improve the workplace environment for foreign workers, we will engage in effective communication and maintain good working relationships going forward.
〈Report〉 Suntory Holdings Limited Findings from Interviews with Foreign Workers(PDF:733KB)
Corrective Action
As part of our efforts to promote corrective measures, if it becomes clear that Suntory Group business activities have directly caused negative impacts on human rights, or if indirect negative impact through business relations come to light or are suspected, Suntory Group will take corrective measures (remedy) through dialogue with related parts, based on international standards and through appropriate procedures. Furthermore, we expect Suntory Group's suppliers to undertake corrective measures (remedy) as well. In order to implement corrective measures, we will also work with external organizations such as human rights experts (NPOs) and Sedex to engage suppliers regarding any issues discovered, and to work together on corrective steps.
Suntory Group is committed to providing redress through due process or cooperating in providing redress for any negative human rights impacts that it has caused (or has been involved in through its business relationships). We are also committed to working with judicial and non-judicial mechanisms, as appropriate, to collaborate in the remediation of harm caused by suppliers directly related to our business.
Corrective Process (Remedy)
As stated in our Human Rights Policy, our key themes in human rights include child labor, forced labor, discrimination and harassment, freedom of association, and a good working environment (health and safety). We have identified numerous questions in the Sedex SAQ that relate to each of these key themes, and we use them for assessment and ongoing monitoring in our own plants and supply chain. We currently conduct continuous monitoring of our suppliers through Sedex, representing over 70% of our purchasing volume globally, and we strongly engage suppliers which we have been able to identify actualized risks. The monitoring process leverages also SMETA* audit information on the supply chain, including interviews with local workers. In this way, we try to leverage the voices of rightsholders.
Our remedy process using Sedex and SMETA information is as follows:
- *SMETA is one of the world's leading auditing schemes and is particularly focused on labor, health, and safety. It especially aims to protect workers in terms of occupational health and safety, overwork, discrimination, low wages, and forced labor. SMETA also leverages the Forced Labor Indicators (FLI) tool embedded in the Sedex risk assessment platform to specifically monitor forced labor risks.
Cases of Potential Risk
-
1.Goal: to confirm that sufficient measures are taken toward avoiding potential risks.
-
2.Index: Sedex risk and management scores.
-
3.Timeframe: check the risk score and management capability score periodically (about once every six months), and confirm the status of the improvement activities of business partners.
Cases of Actualized Risk
-
1.Goal: bring actualized risks down to zero.
-
2.Index: key findings of third-party audit.
-
3.Timeframe: confirm within 6 months that the identified issues have been resolved.
In cases that we cannot confirm that the identified risks have been resolved, we will encourage them to undergo a SMETA audit and strongly urge them to make improvements.
Potential Risks of Suppliers
Regarding the above-mentioned potential risks that can be confirmed in Sedex, we also assess the management capability of our suppliers’ manufacturing sites in respect to the potential risks. Based on that, we engage with manufacturing sites, in particular sites with "high risk + low management capability" and work together with them to improve their management capability. As a result, the management capacity of many manufacturing plants has improved since 2021, when we began reaching out to suppliers. Going forward, we will continue to engage our suppliers and promote improvement activities.
In addition, we are working to clarify which plants have migrant workers (who are seen as being subject to a particularly high level of human rights risk) working there, as well as the number of migrant workers, and to confirm whether the issues that are specific to migrant workers are being actualized.
Changes in Management Capability Scores
- *Scores until 2023 use the old SAQ. The 2024 score uses the new SAQ.
Actualized Risks of Suppliers
We communicate directly with suppliers regarding issues identified in Sedex by third-party audits, and we check that these issues are corrected within six months of having been pointed out. Of a total of 544 important non-compliances specified as of the end of December 2024, we confirmed that 502 have been corrected. We will continue to engage with suppliers on the remaining non- compliances as we move ahead with remedial actions.
More specifically, we have reviewed all Sedex SAQ responses under the former format regarding the following key human rights themes, and identified data indicating potential risks. At the same time, we have reviewed the findings of SMETA audits, to be check whether any potential risks have been actualized. In those cases, we engaged with the suppliers in question and confirmed the status of the corrective actions taken. With the new SAQ, we will continue to review and analyze responses and, in conjunction with audit findings, confirm the status of corrective actions taken when risks have become apparent.
● Child Labor
We regard child labor as one of the key human rights risks in supply chains, and are strengthening management of suppliers through Sedex and SMETA audit information. For example, we use the questions in Sedex to identify direct and indirect workers who may be considered underage workers (under 15). In addition, based on actual on-site audits conducted through SMETA, we confirmed that worker age verification is being performed properly, and corrective actions are being taken when issues become apparent.
A review of SAQ responses from approximately 1,050 manufacturing sites indicated that there was no child labor by those under the age of 15. At 5% of plants, there were workers of ages 16-17, which by itself is a legal working age on the countries where those workers were found. The findings of one SMETA audit also noted a 17-year-old worker, but we have confirmed that this was not a problem under local law.
In addition, 10 instances of inadequate worker age records and verifying documents were noted, but we have engaged the suppliers and confirmed that the recording methods have been corrected.
● Forced Labor
We consider forced labor to be one of the key human rights risks in supply chains and are strengthening management of suppliers through Sedex and SMETA audit information.
1) Recruitment fees
A review of SAQ responses from approximately 1,050 supplier manufacturing sites showed that 4% of respondents had no policies, and 1% of the respondents had no initiatives to address the burden of recruitment fees on workers. In addition, 1% of the respondents indicated that the workers bear costs in some form. SMETA audits found five instances of non-compliance related to the burden of recruitment fees on workers, but we confirmed that these had already been addressed by revising the supplier’s internal regulations, and through refunds and other measures. Similarly, there were three findings regarding wage reductions, but we confirmed that there were no deductions that were problematic under local law.
2) Wages
A review of SAQ responses from approximately 1,050 supplier manufacturing sites showed that 95% of wage payments occurred digitally, such as by bank transfer, and only around 2% of payments were cash. Sixteen percent of responses indicated challenges in managing overtime pay for indirect employees.
Approximately 0.1% of sites reported a minimum wage difference of 50% or more between men and women. As such, there was no gender wage gap issue.
The review also showed lack of visibility regarding indirect employees’ minimum wage. SMETA audit findings also included 54 instances of non-compliance related to wages.
We have engaged our suppliers and confirmed that currently there are no confirmed cases of uncorrected wage issues (the issues found had been solved).
3) Freedom of movement
No risk information regarding freedom of movement was found in the SAQ responses or the SMETA audit.
4) Working hours
Based on a review of SAQ responses from approximately 1,050 supplier manufacturing sites, approximately 85% had a working-hour management system, and 15% had manual management. Ninety-seven of the SMETA audit findings related to recording and managing working hours.
Going forward, we will work to engage with suppliers in upgrading their working-hour management methods.
● Freedom of Association and Collective Bargaining
We consider impediments to freedom of association and collective bargaining to be one of the key human rights risks in supply chains, and are strengthening management of suppliers through Sedex and SMETA information to prevent infringement of these rights. For example, we leverage questions in Sedex to check the presence of labor unions, as well as processes and organizations in which workers can participate and have their participation reflected in decision-making by the supplier company. In addition, we confirm through SMETA audit data whether the rights to freedom of association and collective bargaining are being protected, and engage in corrective actions when issues become apparent and are uncorrected.
On the point of whether processes, organizations, and arrangements were in place for workers to use and reflect in company decision making, the SAQ data indicated that 14% of supplier manufacturing sites did not have these mechanisms in place. In addition, data from the SMETA audit included six findings related to freedom of association and collective bargaining, but we have confirmed that corrections have already been made.
● Health and Safety
We regard health and safety to be one of the key human rights risks in supply chains, and we are strengthening management of our dealings with our suppliers through Sedex and SMETA information to promote their health and safety conditions. For example, we leverage questions in Sedex to check facts such as whether a health and safety policy is in place, whether there have been any serious work accidents, the numbers of participants in fire safety drills, and the supplier's existing efforts to enhance health and safety. We also analyze similar data through SMETA audits and engage in corrective actions when issues are apparent and uncorrected.
The SAQ data showed that 2% of production plants had more than 100 recorded accidents in the past 12 months, and 1% reported more than 20 serious accidents. We will engage with these high-risk supplier manufacturing sites and work toward enhancing their occupational safety. Data from the SMETA audit also showed 275 instances of health and safety non-compliance, with remedial actions having already been taken with respect to 167. We will continue to engage with suppliers on the 23 instances of non- compliance for which corrective actions are still pending. Corrective actions for the health and safety risks found through the Sedex’s SAQ answers and non-compliance by SMETA were shared with other suppliers in an effort to improve health and safety management (FY2024).
● Land Rights
We are strengthening management of suppliers through Sedex information to identify human rights risks related to land rights. Specifically, we leverage questions in Sedex to determine whether the land on which a given supplier's production plant is sited was used as a residence before construction.
The SAQ results showed that 1% of such land was used for residential buildings prior to conversion to an industrial site. We will engage with the suppliers to confirm whether there is a possibility that the conversion could have led to a violation of land rights.
● Water Access and Sanitation
We are strengthening management of suppliers through Sedex data to understand risks related to the water access and sanitation rights of local communities. For example, we leverage questions in Sedex to check various pollution risks (soil, rivers, etc.) from supplier operations, their water usage volumes, whether they manage wastewater, and management of water quality impacts on local areas. The SAQ results showed that 5% of the manufacturing plants were not managing the quality of their wastewater. In other plants, wastewater quality management and internal education were being implemented. The SMETA audit data showed three instances of water treatment non-compliance, and we are confirming corrective action with suppliers.
● Women's Rights
We are strengthening management of suppliers through Sedex data to identify risks related to women’s rights. For example, we leverage questions in Sedex to check the ratio of male to female workers, the ratio of female managers, whether anti-discrimination policies are in place, and rates of absenteeism and turnover among female workers. The SAQ data showed that 5% of manufacturing sites did not have separate washing facilities for men and women. During the previous year, 2% of manufacturing sites had a turnover rate among female workers of more than 50%, while 3% of sites saw the same turnover rate for male workers. One percent of manufacturing sites had an absenteeism rate among female workers of more than 30%, while 3% of sites saw the same absenteeism rate for male workers. The data from the SMETA audits did not demonstrate any non-compliance in this respect.
● Remedy
For example, Sedex questions were used to identify employee grievance notification mechanisms and grievance handling management. SAQ results indicated that approximately 70% of plants had a mechanism for reporting through a labor union, 75% had one for direct appeals to management, and 55% maintained a reporting hotline. These mechanisms were for onsite workers; the number of plants with mechanisms for offsite workers was close to zero, and we regard this as an issue that needs to be addressed throughout the supply chain. No issues relating to grievance handling were noted in the SMETA audit data.
● Training
For example, Sedex questions are used to confirm employee training status. SAQ results indicated that approximately 50% of plants provide labor, human resources, and recruitment policy training, with over 200 employees trained on average. About 65% of plants provide environment-related training, with approximately 30 employees trained on average, mainly managers. About 70% of sites provide bribery-related (business ethics) training, with approximately 180 employees trained on average. Approximately 50% of sites have received training in responsible sourcing, with approximately 25 procurement-related employees receiving training on average. Approximately 20% of sites provide similar training to external suppliers.
SMETA audit data indicated that employees were not receiving required health and safety training at 37 sites, and were not receiving training on business ethics- and bribery-related training at 13 sites. While we are engaging with suppliers to confirm that corrective actions are under way as needed, we are aware that such training for employees and suppliers presents challenges, and will recommend that suppliers utilize Sedex e-learning and other training programs going forward.
Measuring the Effectiveness of Actions Taken (Monitoring)
We measure the effectiveness of our assessment and remediation efforts through Sedex at our plants and in our supply chain by measuring the degree of improvement across multiple risks (health and safety, worker age, discrimination, work based on free choice, etc.) before and after the execution of remediation efforts addressing the risks we have identified through the Sedex. In the case of Sedex assessment, there are items for which it is challenging to reduce the potential risk, but even if the potential risk is high, the risk can be controlled if the management capability is high. Based on this premise, we focus on improving management capability as we undertake corrective actions at our own plants and with our suppliers.
Furthermore, as part of the series of steps noted above, we provide feedback to stakeholders on the results of our effectiveness measurement, and carry out direct engagement that leads to further actions for improvement.
Action Plan
While taking into consideration the risks and other factors identified through the above process, we will implement the following priority initiatives as our action plan.
● Own Plants
We will carry out assessment activities utilizing Sedex's new assessment SAQ at principal domestic- and international-business plants during 2024 and 2025.
We also plan to promote similar Sedex assessment activities with contract manufacturers and with subcontractors operating in our plants.
● Supply Chain
With regard to 1st tier suppliers, we will continue to promote the remedy of important non-compliances that have become apparent through Sedex, and will continue to encourage suppliers to improve their management capabilities with regard to potential risks. In addition, we will move forward with impact assessments for upstream suppliers in our main raw materials supply chain.
● Migrant Workers
We will identify sites other than our own plants where migrant workers (especially technical intern trainees) are present, and consider necessary steps depending on the degree to which the significant risk of forced labor is present.
Access to Remedy
Internal Reporting System
● Hotline
The basic rule in Suntory Group is that when an employee discovers actions that breach the Suntory Group’s Code of Business Ethics, they must first report it to the supervisors and seek their advice. However, we have also established a Compliance Hotline both internally (our Compliance Office) and externally (3rd party law firm) as contact point for all of the Group companies in Japan in order to quickly discover and resolve compliance issues when reporting or consulting with a supervisor is not appropriate.
Both mechanisms are available in multiple languages so that foreign employees who do not speak Japanese fluently can use easily use them.
We have also implemented a global contact point for compliance issues encompassing all Group companies in Japan and globally as part of our global risk management system.
This contact point supports multiple languages such as English, Chinese, and Spanish, and accepts reports and consultations from multiple countries. Additionally, in order to avoid accessibility issues due to technical or financial reasons, we have made this mechanism accessible to all employees through different methods (digital and analog), including web, smartphones, telephone, and mail.
The internal awareness of this mechanism is measured every year through initiatives such as the "Employee Awareness Survey" as a way to engage users and assess the current mechanism, and the current awareness rate is over 90%. We also strive to keep improving the awareness rate and accessibility of this mechanism by sharing these results (including comparisons with previous year) with our top management.
In 2024, a total of 386 reports were received through these contact points in Japan and overseas. There were no reports relating to child labor or forced labor.
If there is a suspicion of non-compliance based on the content of the report, we take into consideration the privacy protection of all persons involved in accordance with the Suntory Group Internal Reporting System Regulations. In that case, the compliance officer promptly conducts a confidential investigation within the company, and promptly requests correction while escalating to the relevant executive in charge, so that measures can be taken as soon as possible in order to avoid any negative impact to the reporter. The results of the survey are shared to the reporter and management, respectively, to promote corrective measures and prevent recurrence. After a certain period of time has passed after the response, we close the case once we receive a report on the state of change from senior management as a follow-up.
Furthermore, regarding measures against harassment, which is a priority issue, in many cases there is a difference in values with colleagues and related parties, so we aim to create a culture where both sides can recognize the difference by providing an opportunity to learn about unconscious bias. In this respect, we hold seminars from time to time to promote a more tolerant organization.
● Protecting the Reporters
Based on our internal regulations, the Suntory Group prohibits any type of negative impact such as retaliation or spread of rumors and does not force confidentiality on the reporters. In order to achieve this, when the Compliance Office conducts an investigation, it identifies the persons concerned and then confirms the "internal reporting system regulations," protecting thus the rights of the reporter.
In addition, during the interviews with the reporter on the closing of each case, we also check that reporters have not suffered any disadvantages during the process.
Furthermore, we are working to create a culture in which compliance reports are protected not only by the persons concerned, but also by the entire workplace by proactively disseminating the "internal reporting system regulations" within the company on a daily basis.
External Reporting System
Since its founding, Suntory Group has placed customer satisfaction first and valued proactive communication with customers. In addition, based on our belief that all our stakeholders are customers, business partners are also regarded as important customers. Therefore, when promoting human rights due diligence, we believe it is important that not only our employees, but also our direct suppliers, their own suppliers, as well as other related parties (their local community, etc.) have access to a grievance mechanism, including human rights issues. Furthermore, as stated in our Suntory Group Partner Guidelines, we expect partners to establish similar grievance mechanisms (with no retaliation) within their own supply chain, thereby striving to promote access to remedy upstream in our supply chain.
Currently, we have established a Suntory Group Business Partner Compliance Hotline and Customer Center as a contact point for suppliers and their related parties (communities) to use, which accepts inquiries from all customers.
Grievance Mechanism for Migrant Workers
In order to strengthen our human rights due diligence efforts, Suntory Group joined the "Japan Platform for Migrant Workers towards Responsible and Inclusive Society" (JP-MIRAI) multi-stakeholder initiative in 2023. With this step, we aim at building a grievance mechanism in which we can gather not only the voices of our supply chain workers and/or their representatives without any type of retaliation or censorship (particularly from vulnerable groups such as migrant workers), but also directly share with them helpful information regarding life in a foreign country, how to obtain language support, etc. in order to improve their quality of life and protect their rights.
Users can seek for help anonymously by phone, chat, or email, and they are first connected to an independent NPO specialized in supporting migrant workers, who then escalates to us based on the contents shared by the worker. After that, we promptly analyze if any risks may be occurring, and engage the corresponding parties in order to help the worker and deliver remedy as soon as possible.
This service is available in 9 languages: "easy" Japanese, English, Spanish, Portuguese, Bahasa Indonesia, Vietnamese, Tagalog, Chinese and Burmese.
More information about JP-MIRAI can be found on the following link :
Stakeholder Engagement
We utilize information on Sedex and third-party interviews as key processes to engage with stakeholders (rightsholders).
As an example of information gathering through Sedex, when we implement Sedex at our own plants, we communicate directly with the office management of each plant to exchange opinions from the perspective of human rights risks. An example of our third-party interviews can be seen in the third-party interviews conducted by CRT with migrant workers (foreign technical intern trainees) at our group company Izutsu Maisen in February 2024. In doing so, we listened to their perspectives on human rights and related issues of migrant workers (communication, cross-cultural understanding, and creating a more comfortable workplace). We regard this as important information to be used in our future human rights due diligence efforts.
Communication with Business Partners
We believe that communicating with stakeholders on human rights risks and impact is critical to our stakeholder engagement. For example, we carry out direct communication that is attentive to rightsholders (as in the interviews with migrant workers at Izutsu Maisen described above), and we communicate through briefings for suppliers (on Suntory Group Partner Guideline compliance).
On the other hand, while identifying and approaching rightsholders upstream in the supply chain is a very important component of stakeholder communication, it is also a challenging area of activity that must be addressed step by step and after proper prioritization. We plan to engage and communicate with the main stakeholders of the high-potential-risk and high-impact raw materials that we identified.
Human Rights Training for Business Partners
From 2022, Suntory Group has started to hold annual training sessions on sustainability towards our main suppliers, with an agenda on human rights including child labor and forced labor, in which we engage our ingredients suppliers to think about these risks and act towards prevention and mitigation. For the first of these training sessions, we engaged more than 120 attendees from 50 suppliers. The effectiveness of this training is measured through the following Sedex results on human rights related scores.
Further, in November 2023 we held a meeting to exchange opinions with domestic packaging suppliers regarding occupational health and safety, including opinions regarding prevention of serious accidents, which is a cross-sectional issue, based on the Sedex assessment. Through discussion with suppliers, we debated which measures could be taken to prevent accidents during dangerous operations, for example when operating forklifts. In addition, suppliers gave presentations profiling their internal awareness-raising approach with respect to such measures. As a forum for proactive awareness-raising with respect to occupational health and safety, the meeting served as a Sedex human rights evaluation activity.
Video to Raise Awareness about Business and Human Rights
In line with the revision of our Human Rights Policy in 2024, we have produced an original video to raise awareness about human rights to help our employees, business partners, and other stakeholders understand Suntory Group's efforts to respect human rights. This video is available to view in Japanese, English and Chinese so that it can be used to foster awareness of respect for human rights throughout Suntory Group's value chain, including overseas business locations.
Communication with Employees
Initiatives to Raise Awareness
Every year, Suntory Group conducts a sustainability e-learning program for approximately 20,000 employees to learn about global ESG trends, including human rights, and the company's initiatives. In addition, to facilitate understanding of the Suntory Group's Code of Business Ethics (including human rights) among all officers and employees of the Suntory Group, and to encourage them to practice these ethics in their daily activities, we have included the Code in a booklet that summarizes the Suntory Group's system of philosophy, which is distributed to all employees. To promote global understanding, we have translated the booklet into 11 languages, and its contents are read and signed once each year. Group companies outside Japan also carry out similar efforts to promote compliance and human rights understanding in various regions.
Regarding our corporate management, every year we provide briefings on sustainability encompassing human rights as part of our annual training for newly appointed managers. In addition, members and management of the procurement department, which is closely involved with human rights initiatives, are all provided with briefings on sustainability encompassing human rights.
For management, we invited experts to hold study sessions on human rights with the Board of Directors.
Freedom of Association and Collective Bargaining
Suntory Group holds regular labor-management council meetings which bring together union representatives and senior managers, and we liaise closely with the union regarding everything from labor issues to managerial and business issues, with senior management responding in a serious manner to all points raised by the union. (All employees other than those holding managerial positions are required to join the union)
Measures to Reduce Excessive Working Hours
Besides adhering faithfully to labor laws (including those relating to working hours) in each country where it operates, Suntory Group also implements measures, through labor-management collaboration, to reduce long working hours and prohibit unpaid overtime, as well as encouraging employees to take their annual paid leave. In addition, we have adopted a system that enables daily checking of time-use data, including the amount of time spent using a computer, etc., and we provide support for employees to implement self-directed time management, while also formulating appropriate response measures, including the provision, where needed, of guidance on how to realize improvement.
Dialogue with Experts
Suntory Group holds regular dialogue with experts on human rights from Japan and overseas to strengthen initiatives related to human rights. In 2023, we engaged in dialogue with Human Rights Watch (HRW), a human rights NGO, and with human rights experts from other international NGOs.
In our dialogue with HRW, we discussed the assessment of human rights risk which is necessary when developing a new business, and how to respond when a human rights issue becomes actualized. We also received advice from human rights experts associated with global NGOs regarding the need to review human rights related measures in light of the proposed Directive on Corporate Sustainability Due Diligence in the European Union.
In dialogue with global experts conducted in collaboration with the Caux Round Table Japan (CRT Japan), we engaged in a productive exchange of views regarding the scale and scope of support needed to address human rights issues in the upstream portion of the raw materials supply chain, and the right approach for this, as well as prioritizing in the value chain, dialogue with civil society, etc., and we received valuable advice regarding the best approach for responding to these kinds of issues, and the key points to consider.
Going forward, we will continue to engage in this type of dialogue, and will reflect the results of this dialogue in our human rights measures.
<Dialogue with Experts in Recent Years>
| Year | Contents |
|---|---|
| 2019 |
|
| 2020 |
|
| 2022 |
|
| 2023 |
|
| 2024 |
|
