Supply Chain Management

As a general telecommunications operator that supports social infrastructure, we are working on risk awareness and the enhancement of supply chain risk management with all business partners inside and outside Japan, in line with the KDDI Group Sustainable and Responsible Procurement Policy, to meet social demands at a higher level and avoid procurement risks as much as possible.
The policy defines eight applicable themes for appropriate supply chain management: Co-existence and Co-prosperity with Business Partners, Consideration of Global Environment, Fair and Equitable Trade, Considerations for Human Rights and Labor Environment, Fair Management of Information, Ensuring Quality and Safety, Co-existence with Society and Applicable Scope.
To offer satisfactory services to our customers and achieve the sustainable development of the company and society together with our business partners, we are extending our demands and support based on this policy to all business partners inside and outside Japan.
This policy has been rolled out in four languages (Japanese, English, Chinese, and Korean), with the aim of spreading the policy throughout the entire supply chain.

KDDI utilizes external research organizations to conduct risk assessments of new business partners from environmental and social aspects. KDDI investigates the partners' scale, background, credibility, business conditions, financial conditions, etc., and if they meet a predetermined standard, we conduct business with them. In case of a serious violation of compliance, such as those related to human lives, we deal with issues, including conducting reviews of transactions, until corrective actions are completed. Through Responsible Procurement Surveys targeting our tier-1 suppliers, we have also conducted surveys of tier-2 and tier-3 suppliers on issues such as human rights and conflict minerals since fiscal year 2018. In this way, we confirm each supplier's compliance with the KDDI Group Sustainable and Responsible Procurement Policy.

We established the KDDI Group Sustainable and Responsible Procurement Guidelines for implementing its procurement policy and published them on our website (in Japanese and English). The guidelines were formulated based on the Responsible Business Alliance (RBA; formerly called the Electronic Industry Citizenship Coalition (EICC)) code of conduct and Responsible Business Conduct Guidelines published by the Japan Electronics and Information Technology Industries Association (JEITA). The guidelines provide criteria to consider in selecting business partners and procurement items, not only for quality, price, delivery and stability of supply but also for environmental and social impacts. In response to the results of the human rights impact assessment conducted in March 2020, we revised the content of the guidelines in March 2021 to further include consideration for human rights.
We have also established the KDDI Green Procurement Guidelines to reduce CO2 emissions throughout the entire supply chain and are cooperating and collaborating with our business partners to achieve carbon neutrality.

To gain an understanding of the status of the entire KDDI Group supply chain and risk assessments, we also conduct surveys targeting our leading business partners to support their understanding of our sustainable procurement initiatives and communicate the current situations and the progress made. In case of compliance violations committed by business partners, KDDI requests them to identify the causes and requests improvement. We offer guidance and support action if necessary.
Based on our Code of Business Conduct, we do not perform any transactions with organized crime groups.