Relationships with Business Partners

Procurement

Procurement Policy

The following explains Kubota's basic approach to materials procurement in its business activities.

Basic idea for materials procurement

  1. Providing fair opportunities
    We provide opportunities for competition among all of our business partners in a fair and equitable manner.
  2. Economical rationality
    When selecting a business partner, we make a full evaluation on the material quality, reliability, delivery timing, price, technology and development capability, proposal ability, and the business stability, etc. of that partner and then select the best business partner based on a suitable set of criteria.
  3. Mutual trust
    We establish relationship of trust with our business partners and also aim for mutual development.
  4. Social trust
    We are committed to ensuring adherence to all relevant laws and regulations for when making procurement deals. We will also make sure to maintain the confidentiality of our business partners’ information which we have gained through our procurement deals.
  5. CSR procurement
    We promote CSR procurement, while paying close attention to compliance with laws and regulations, occupational health and safety, human rights (including addressing the issue of conflict minerals), environmental conservation, symbiosis with society, and information disclosure in a timely and appropriate manner.
  6. Green procurement
    We are committed to the procurement of products with a reduced environmental impact from business partners that engage in environmental activities, as part of our commitment to providing society with products that are friendly to global and local environments.

Promoting CSR Procurement Based on Established Guidelines

Customers are becoming increasingly aware of what goes on in the entire supply chain that creates products and services.

For this reason, Kubota has established the Kubota Group CSR Procurement Guidelines, based on the belief that it is necessary to have a common understanding of CSR with its major business partners in order to engage in collaborated efforts. By requesting business partners to submit a consent form indicating their intention to observe the terms of these guidelines, Kubota is encouraging its business partners' initiatives that target safe work practices, respect for human rights, and other important factors.

The Kubota Group CSR Procurement Guidelines

  1. Winning Customer Satisfaction
  2. Conducting Corporate Activities Based on Compliance with Legal Regulations and Ethical Principles
  3. Respecting Human Rights
  4. Building up a Safe and Vibrant Work Environment
  5. Conserving the Global and Local Environment
  6. Achieving Symbiosis with International and Local Societies
  7. Fulfilling Responsibilities for Improving Management Transparency and Accountability

Enforcing Ban on the Use of Conflict Minerals

Kubota addresses the issue of conflict minerals as part of its CSR procurement initiatives. Conflict minerals refer to the tantalum, tin, tungsten and gold produced in the Democratic Republic of the Congo and its neighboring countries. Armed insurgents, many of whom have repeatedly committed inhumane acts of violence, use these minerals as a source of funds and this is a major international issue of concern.

Kubota conducts investigations into the use of conflict minerals, and promptly takes steps to discontinue use in the unlikely event that it becomes clear they are being used. To this end, Kubota seeks mutual understanding regarding this issue with its business partners, which are a part of the supply chain, and requests their cooperation in surveys and audits conducted by Group companies.

In FY2016, Kubota partially revised the Kubota Group CSR Procurement Guidelines so as to include a clear statement on conflict minerals in the Guidelines.

Democratic Republic of the Congo and neighboring countries.

Figure:Democratic Republic of the Congo and neighboring countries.

Promoting Optimal Regional Procurement and Supplier Quality/Productivity

Procurement at overseas production bases has risen sharply in parallel with the rapid globalization of business.

The Kubota Group promotes optimal procurement in every region through the establishment of a global supply system. Moreover, the Group unites with major global suppliers to promote systematic improvement activities for the purpose of strengthening competitiveness by improving quality and productivity.

In FY2016, as a continuation of the previous year, Kubota held the 3rd Supplier Skills Competition to improve the skill level of its suppliers. Moreover, the 3rd Supplier Improvement World Cup was also held in order to vitalize improvement activities. In this World Cup, suppliers selected from various regions around the world present their company's successful improvement cases as they compete for the status of World Champion.

Throughout the entire supply chain, Kubota will continue its efforts to make the Kubota brand trusted and appreciated by its customers around the world.

Photo:Kubota Supplier Skills CompetitionKubota Supplier Skills Competition

Photo:Kubota Supplier Improvement World CupKubota Supplier Improvement World Cup

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