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Master Transaction Agreement

The following articles are incorporated in the master transaction agreement we conclude with each supplier, and compliance to these articles is required as important items.

Article 33 Environmental Policy and Environmental Laws and Regulations
Article 39 Elimination of Anti-social Forces

CSR Procurement Policy

FANUC established the CSR Procurement Policy in July 2019.
The Supplier Code of Conduct is prescribed within this Policy. We send this Policy to each supplier and request their compliance.

Declaration of Partnership Building

In August 2020, FANUC released a Declaration of Partnership Building with the aims of building mutually-beneficial relationships with suppliers in its supply chain and increasing added value across the entire supply chain through new partnerships with suppliers.
The framework and structure for the Declarations of Partnership Building have been confirmed by the Council on Promoting Partnership Building for Cultivating the Future, which consists of representatives from the business community and labor organizations, as well as government officials, and are being promoted by the Cabinet Office and the Small and Medium Enterprise Agency.
Under our Declaration, we will strive to ensure that SMEs do not bear the brunt of unfair trade conditions caused by the impact of COVID-19, surges in raw materials and logistics costs, and other reasons, and we will continue our efforts actively to encourage companies to introduce appropriate subcontract practices. We will also encourage the building of new partnerships that involve efforts to increase added value across the supply chain and open innovation that transcends business size, groups, and other boundaries.
To this end, going forward, we will continue to strive to develop mutual cooperation and relationships of trust that will enable us to grow and prosper together with our suppliers, with a view to fulfilling the social responsibilities of the entire supply chain.

Conforming with Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors and Act on the Promotion of Subcontracting Small and Medium-sized Enterprises

FANUC strictly complies with the Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors and the Act on the Promotion of Subcontracting Small and Medium-sized Enterprises (collectively, hereinafter the “Subcontract Proceeds Act, etc.”). Approximately 358 companies, or 34% of all of our suppliers, are subject to the Subcontract Proceeds Act. We pay rigorous attention to ensure that there is no unjust disadvantage to our suppliers, in accordance with the Subcontract Proceeds Act, etc.

Conflict Minerals

FANUC has a policy of not using conflict minerals* in its products. Accordingly, we strive to gather as much information as possible from our suppliers, in order to confirm that the minerals are not sourced by illegal mining from conflict areas.

* Conflict minerals refer to minerals (tin, tantalum, tungsten, and gold) that are illegally mined in conflict areas (Democratic Republic of the Congo and surrounding regions). Companies listed in the United States are required to disclose and report the use of such minerals, under the conflict mineral disclosure rule (Dodd-Frank Act) of the U.S. Securities and Exchange Commission (SEC).

Reduction and Elimination of Harmful Substances Contained in Products

FANUC promotes reduction and elimination of use of harmful substances targeted by the RoHS Directive and the REACH Regulation. Accordingly, we notify our suppliers of the related policies and request their cooperation. Since new substances may be included due to revisions of the regulations, we always strive to obtain the latest information regarding the directive and regulations.

Establishment of the Supplier Hotline

In June 2021, FANUC set up the Supplier Hotline as a contact point for suppliers to report to if they discover illegal, fraudulent, unethical, or suspicious acts related to the business of the FANUC Group. Executives and employees of our suppliers can report directly to designated law firms, enabling us to promptly discover, correct, and prevent problems.

Disposal of Molds and Payment of Storage Fees

In March 2020, to protect subcontractors, the Ministry of Economy, Trade and Industry and the Small and Medium Enterprise Agency revised and enforced the standards for encouraging fair practices and other guidelines concerning approaches to enhancing proper mold management stipulated in the Act on the Promotion of Subcontracting Small and Medium-sized Enterprises. Under the new standards, it is necessary to dispose of molds that have not been used for a long time or to pay subcontractors for the cost of storing them.
FANUC asked our subcontractors that store molds to file an application regarding the molds they wish to dispose of. We approved the disposal of some molds, and decided to pay storage fees for the other molds that should not be disposed of. We began the disposal of molds in March 2019 and the payment of storage costs in March 2020.

Lump-sum Full Payment of Mold Costs

In the payment of mold costs to subcontractors, the standards stipulated in the Act on the Promotion of Subcontracting Small and Medium-sized Enterprises calls for the transition away from long-term payment methods such as 24-month installments, which place a burden on subcontractors, to methods of early payment, such as lump-sum payments. In April 2020, FANUC changed from the 24-month installment payment method we had previously employed to a lump-sum payment method.