Procurement BCP Initiatives
Policy on Approaches
With the increasing importance of corporate sustainability and risk management, the role that the procurement department must play is becoming ever more significant. Especially in today's world, where preparedness for unforeseen events such as natural disasters and pandemics is required, it is urgent for the procurement department to establish a system that can respond quickly and effectively.
We have established a "Procurement BCP Committee"—consisting of representatives from each Business Unit—that meets four times a year to plan and promote measures for procurement business continuity planning (BCP) and strengthening procurement assurance across the entire group. After standardizing and visualizing risk levels across the entire company, various measures are being discussed to achieve stable procurement through strengthening relationships with suppliers and to prepare for political turmoil, natural disasters, and other contingencies. The status of these measures is reported to management, and consistent BCP activities are promoted throughout the company. The purpose of the Procurement BCP Committee's activities is to identify risks to procurement assurance within the procurement process, proactively suppress the occurrence of those risks, and mitigate their impact if they are realized, thereby supporting the stability of business operations. It aims to establish a framework through which the procurement department contributes to the value creation of the entire company and plays the role in the company's overall risk management system.
Awareness of Issues
The activities of the Procurement BCP Committee started in 2018 and are currently focused on the Electronics Business Headquarters, Mobility Business Headquarters, and Functional Materials Business Headquarters, with plans to gradually expand the scope of activities to other Business Unit. In today's world of increasing uncertainty, the risks to procurement assurance are diverse and continuously arise and change, so it is necessary for us to continuously improve our procurement assurance activities without interruption. Through the activities of the Procurement BCP Committee, we aim to achieve continuous and comprehensive business improvements and strengthen the procurement BCP of the entire group.
Key Initiatives
1. Risks from accidents and natural disasters 2. Risks related to supply and demand gaps*1 3. Risks related to End of Life (EOL) / Product Change Notification (PCN)*2 4. Geopolitical risks: We are implementing the following measures.
- *1 Suppliers' insufficient supply capacity relative to our company's demand.
- *2 Discontinuation or change requests of procured materials
- Measure 1. Continuous improvement activities addressing risks 1 through 4.
- Measure 2. Communicating requirements for stable supply to suppliers.
- Measure 3. Strengthening relationships with suppliers.
- Measure 4. Rapid Response to Incidents