Building Responsible Supply Chain Management / Promoting Sustainable Ingredient Sourcing
Basic Approach
As we continue to globalize our supply chain, we are required not only to provide safe and reliable products, but also to consider various aspects of the entire supply chain that supports FamilyMart’s businesses. These include reducing GHG and waste, preventing environmental pollution, preserving biodiversity, respecting human rights and labor practices, employee health and safety, and addressing labor shortages in logistics. In addition, as natural disasters, which are thought to be caused by climate change, become more frequent and severe with each passing year, as a business that is expected to continue operations in times of emergency, we are also required to strengthen our resilience by building sustainable procurement and product supply networks that can withstand disruptions to daily business in disasters.
FamilyMart is promoting supply chain management guided by our Sustainable Procurement Principles, Sustainability Action Guidelines for Supply Chain, and FamilyMart’s Human Rights Policy, which were established based on our Sustainability Policy. We will promote sustainable procurement throughout the supply chain toward the realization of a sustainable society in cooperation with marine and agricultural suppliers, as well as producers and importers of ready-to-eat products and Famimaru (FamilyMart's private brand) products.
Supply Chain Audits
FamilyMart regularly audits and monitors its supply chain, not only from the perspective of quality and hygiene management, but also for nine matters from a CSR perspective, such as human rights, labor, and the environment.
In fiscal 2022, FamilyMart conducted self-assessment questionnaires (SAQ*) at all 32 producers of our ready-to-eat products for both sides to assess their current status.
Furthermore, to make more objective and rigorous judgments, external auditors from a third-party review organization conducted supply chain audits at 12 factories: eight audits (online) in the first half of the year and four audit (onsite) in the second half of the year. During supply chain audits, we confirm that there are no serious violations of laws and regulations or cases requiring urgent corrective action, and work with our business partners to improve matters that require corrective measures.
Japan Food Supply also sent out questionnaires to all 188 manufacturers of ready-to-eat food ingredients, asking about sustainable procurement and human rights. Responses were provided by 160 companies, and the results were shared with us.
In the future, we will expand the scope of the SAQ and auditing/monitoring.
*A CSR Procurement Self-Assessment Questionnaire developed by the Supply Chain Subcommittee of the United Nations Global Compact Network Japan. It consists of items related to sustainability, including human rights, labor, the environment, and fair corporate activities.
Sustainable Procurement Principles
FamilyMart recognizes its social responsibility to work toward the realization of a sustainable society, including the preservation of the global environment and protection of human rights, in its business activities.
To this end, we promote business activities based on the spirit of mutual development (CO-GROWING) in accordance with fair rules with producers and business partners, and work on the following items while achieving sustainable growth together.
- We will give consideration to the conservation of biodiversity and eliminate illegal trade, extraction, and fishing of natural resources.
- We will protect natural resources that are in danger of depletion, and seek to reuse renewable resources.
- We will establish traceability of agricultural, livestock, and fishery products with the safety, security, and health of our customers as our top priority, and strive to disclose information in a manner that is easily understood by our customers.
- We aim to create a sustainable society with producers and business partners who comply with laws, regulations, and social norms, and who fulfill their social responsibilities in the areas of human rights, labor, health and safety, and global environmental conservation.
Established February 2018
Sustainability Action Guidelines for Supply Chain
- Compliance with laws and regulations
We will comply with international norms as well as the laws and norms of the countries and regions in which we operate, and conduct our business activities with integrity. - Human rights
We respect people and their rights regardless of race, color, nationality, language, religion, ideology, age, gender, sexual orientation, gender identity, disability, property, employment status, etc., and will not be complicit in human rights abuses.
We shall also give due consideration to the health and safety of our employees, realize a comfortable working environment, and not be complicit in discrimination, inhumane treatment, forced labor, etc. in employment. - Fair business dealings
We will conduct business transactions under appropriate conditions in accordance with sound business practices and will work against corruption in all its forms, including extortion and bribery. - Environment
We will strive to give due consideration to the global environment, nature, and biodiversity, prevent environmental pollution, and promote measures to counter global warming, such as reducing greenhouse gas emissions and energy use. We will also work to create a recycling-oriented society through waste reduction, proper disposal and recycling, and reduction and streamlining of resource use. - Quality and safety
We will provide products and services that are safe, secure, and healthy for our customers, and in the event of an accident or defective products, we will promptly disclose information and notify the competent authorities. - Coexistence with local communities
Contribute to the betterment of local communities through involvement in activities that lead to the development of local communities and consideration of the environmental impact of the area around our business sites or factories. - Supply chain system development
In addition to complying with social norms, we will build a sustainability promotion system and internal controls in response to social demands, and strive to develop a risk management system. In addition, we will strive to disseminate sustainability in our own supply chain.
Established February 2018
Revised June 2023
Sustainable Ingredient Sourcing
FamilyMart carries many original food products, especially ready-to-eat products. Stable procurement of the agricultural crops and livestock products in these items are essential. The impact of droughts and water damage from climate change on harvesting and cultivation of crops and livestock products was studied in our climate scenario analysis in the first half of fiscal 2020. Past measures have sought to establish an ingredient supply system less affected by changes in climate and weather, as through distributed procurement in multiple countries or regions and expanded procurement from vegetable plant factories.
The prices of various raw materials rose in fiscal 2022 due to the Ukraine crisis and the sharp depreciation of the yen, but we have minimized the impact on our product prices with reforms to our procurement structure for raw materials.
We will continue to build a supply chain that addresses future risks.
Additionally, to protect animal welfare, a majority of the poultry in ready-to-eat meals is currently Genesis GAP certified.
We recognize and are responding to the risk posed to sustainable procurement by external factors such as international standards and changes in consumer behavior relating to animal welfare, sustainable palm oil and coffee, marine products, and food containing GMOs.
Enhancing Logistics
FamilyMart has been promoting structural reforms in ready-to-eat products to provide valuable and compelling products.
In terms of logistics, we have overhauled work processes at our logistics centers and delivery routes, including our distribution network. We also use a Transportation Management System (TMS) to enhance our logistics.
We are optimizing our logistics bases while responding to various changes in the business environment caused by global warming and climate change. For example, logistics networks are the lifeblood of retail industry, so to protect ours against typhoons and floods, when considering where to build a logistics center, we check hazard maps and build on land with a low risk of inundation and plan for risk avoidance through such measures as raising the ground level in order to create a more robust base. In the unlikely event that a disaster causes a functional stoppage of one of our logistics bases or ready-to-eat products manufacturing bases, or the road network is disrupted, we have a system to bring in products from nearby distribution bases and give priority to the delivery focus only on high-need goods required in emergencies, such as rice balls, daily necessities, and drinking water.
To cope with the expected 2024 problem* in the logistics industry, we are working to reduce cargo handling time as well as incidental non-driving work, and improve delivery efficiency.
We will continue to aim for the establishment and implementation of a resilient logistics network, taking into consideration not only stable supply but also social issues such as environmental and occupational safety.
*This “2024 problem” refers to the various issues expected to arise in the logistics industry with the April 1, 2024 introduction of upper limits on overtime for workers who drive vehicles.
VOICE
Our company, which manufactures cooked noodles and prepared foods for sale in Kyushu, employs not only local residents but also many foreign nationals. Since we operate day and night to ship products to convenience stores, we are working on the appropriate management of daily labor management which we consider to be one of our most important management issues along with product quality and hygiene management.
In fiscal 2022, ITOCHU Corporation and lawyers conducted a personnel and labor assessment for our company. Based on the assessment results, we are reorganizing our internal rules and creating a work environment that is even easier for our employees to work in, and use these changes to supply safe and secure products.
Kyushu NF Foods Co., Ltd.
Mr. Ken Wakabayashi,
Representative Director and President