Material issue 4: Working with Suppliers to Pursue a Sustainable Supply Chain
Social Context and Recognition of Issues
As the economy becomes increasingly globalized and borderless, enterprises are increasingly procuring goods from all over the globe. This expansion is having an impact on a variety of social issues, including global environmental problems, poverty and inequality, and labor and human rights issues. The expansion of the supply chain not only improves corporate competitiveness, but can also be a major risk factor, as contractors are held responsible for managing unethical behavior of their suppliers. International standards like ISO 26000*¹ and ISO 20400*² have arisen in response, meaning that enterprises are expected to practice responsible procurement on a global scale, based on fair trade with their suppliers and extended throughout their entire supply chains.
As FamilyMart handles an extremely diverse range of products, we recognize the importance of further supply chain management to deliver safe and secure products to all of our customers. We consider it our social responsibility to practice more sophisticated supply chain management to make positive impacts like working for human rights, good labor practices, the environment, and the elimination of corruption.
*¹ An international standard on the social responsibility of organizations.
*² An international standard on sustainable procurement.
Vision
Strong systems based on trusting relationships with our business partners are indispensable if FamilyMart is to continue growing sustainably with society. We will strive to establish and maintain good long-term relationships with our business partners through fair and transparent business practices.
FamilyMart will continue to improve our efforts to contribute to the formation of a sustainable society together with our suppliers based on our Sustainability Policy, Sustainable Procurement Principles, Sustainability Action Guidelines for Supply Chain, and FamilyMart’s Human Rights Policy.
Specific Initiatives
Basic Approach
In order for a retail business operator to provide safe and reliable products, it is essential to have centralized management based on a comprehensive perspective in every stage of procurement of raw materials, production, logistics, and sales.
FamilyMart established the Sustainable Procurement Principles and the Sustainability Action Guidelines for Supply Chain based on the Sustainability Policy to fulfill our social responsibility toward building a sustainable society with suppliers. These principles define our relationships with suppliers and our approach to business with them to build and maintain good partnerships through fair and equitable business.
Value Creation
Since many of the products produced with thorough quality control along the entire supply chain are essential for our daily lives, we have established a specialized department dedicated to quality control and guidelines for recalls and making a decision about whether or not to continue sales of a product in the event of a serious issue. Should a product be found to not fulfill quality control standards, we will take prompt measures to minimize the impact on customers, such as stopping the sales of that product at stores, and have the Quality Control and Manufacture Control Departments provide guidance to the applicable factory in order to prevent a recurrence and to confirm improvements have been made.
Moreover, our supply chain management also indirectly contributes to the enhancement of employee satisfaction at suppliers, which works to enhance trust in FamilyMart.
Operational Structure
At FamilyMart, the Manufacture Infrastructure Development Department of the Supply Chain & Quality Management Division takes the leadership in supply chain management, including the operational status of producers of ready-to-eat items (ready-to-eat items outsources), with the aim of building and improving supply chain management for original ready-to-eat items.
For procurement management, we partner with Japan Food Supply Co., Ltd. (JFS), a group company of ITOCHU Corporation, to make the display of raw materials and the centralized management of traceability available on the system and to secure browsing up to secondary raw materials.