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Responsible Procurement

Last Updated: 2019.02.28
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We have formulated guidelines for responsible procurement in our supply chain. Fast Retailing works with our partner factories to engage in production activities according to these guidelines.

Responsible Procurement Policy

Fast Retailing places orders via proper procedures, protecting the labor conditions and human rights of employees working at partner factories. To promote responsible procurement, we have formulated guidelines consistent with procurement policies and business activities. The Fast Retailing procurement policy consists of three main principles:

1) We protect the health, safety, human rights, and rights guaranteed by law for workers at partner factories, contributing to improved living and labor conditions.
2) We encourage the growth of our partner factories by expanding our transaction volume steadily over time.
3) We meet customer expectations through products manufactured via appropriate processes.

If we are to engage in responsible procurement, our procurement-related departments must practice appropriate procurement procedures. Our guidelines specify these procedures. Further, we provide regular training to employees in our procurement-related departments, covering these guidelines and other matters. In 2018, we conducted training sessions for a total of 480 relevant representatives from the merchandising, marketing, R&D, and production departments of each Fast Retailing Group brand.

Structure for Ensuring Responsible Procurement

Weekly factory visits provide a clear picture of production partner factories and an opportunity to offer guidance for improvement

We must work closely with our production partners to pursue production activities in line with responsible procurement, including proper labor conditions and correct manufacturing processes. We station nearly 500 Fast Retailing production department employees responsible for quality and production progress management at production offices in Shanghai, Ho Chi Minh City, Dhaka, Jakarta, Istanbul, and Bangalore. Those employees responsible for factories, visit production partners on a weekly basis. We use these visits as opportunities to assess conditions and provide guidance for improvements leading to correct production processes.

Fast Retailing assigns dedicated sustainability teams to production offices

Our production offices in Shanghai, Ho Chi Minh, Dhaka, and Jakarta have permanent dedicated sustainability department teams that specialize in initiatives at partner factories. We oversee workplace monitoring activities at partner factories, offering advice and guidance for improving production floor operations.

Training for Production Departments

Fast Retailing operates a program of regular training that covers our Code of Conduct for Production Partners, as well as country-specific education on laws, apparel industry issues, and sustainability issues in production operations. Personnel in charge of sustainability departments use specific cases of everyday operations at each facility to enhance the effectiveness of training.

Business Ethics

Deliberations in the Fast Retailing Business Ethics Committee

Any serious problems in business between Fast Retailing and partner factories (e.g. defects, delivery delays, etc.) are escalated to the Business Ethics Committee. The committee discusses the issue to determine the share of responsibility, the need to revise our business relationships, and other related matters. The Fast Retailing Business Ethics Committee includes external Audit & Supervisory Board members.

Annual Questionnaire for Business Partners

Fast Retailing sends an annual questionnaire to our major business partners to ensure we engage in fair business practices. In fiscal 2017, we added questions related to responsible procurement. Questions include whether we place orders in a way that supports the labor conditions and human rights of our partner factories and whether they believe we pay fair prices. When questionnaire results indicate a need for improvement, our Sustainability Department conducts interviews of both Fast Retailing and our business partners. When issues are identified, they are escalated to the Business Ethics Committee.

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