Case study: How the Yamaha Group promotes sustainability among its suppliers
The Yamaha Group is a Japanese multinational corporation and conglomerate with a very wide range of products and services, and the world’s largest piano manufacturing company. The Yamaha Group promotes sustainability throughout its entire value chain Tweet This!, in areas such as product and service development, raw material procurement, manufacturing, selling, and recycling.
This case study is based on the 2021 Sustainability Report by the Yamaha Group, prepared in accordance with the GRI Standards, that can be found at this link. Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.
Abstract
Yamaha Group’s suppliers are selected according to the standards set in the Yamaha Group Purchasing Philosophy, and are asked to adhere to the Yamaha Supplier CSR Code of Conduct. In order to promote sustainability among its suppliers the Yamaha Group took action to:
- implement a Supplier CSR Code of Conduct
- assess suppliers
- provide training
- engage suppliers
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With this case study you will see:
- Which are the most important impacts (material issues) the Yamaha Group has identified;
- How the Yamaha Group proceeded with stakeholder engagement, and
- What actions were taken by the Yamaha Group to promote sustainability among its suppliers
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What are the material issues the company has identified?
In its 2021 Sustainability Report the Yamaha Group identified a range of material issues, such as development of products and services with a focus on social and environmental issues, lowering of greenhouse gas emissions, systematic initiatives for the respect of human rights, promotion of diversity and human resources development. Among these, promoting sustainability among its suppliers stands out as a key material issue for the Yamaha Group.
Stakeholder engagement in accordance with the GRI Standards
The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:
Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.
Key stakeholder groups the Yamaha Group engages with:
To identify and prioritise material topics the Yamaha Group engages with its stakeholders through the following channels:
| Stakeholder Group | Method of engagement |
| Customers
| · Product and service helpdesks (telephone, email, etc.) · Daily sales activities |
| Shareholders and Investors
| · General shareholders’ meetings · Explanatory meetings for investors · Investor website and email newsletters |
| Employees
| · Survey questionnaires (motivation, management awareness) · Labour–management meetings and discussions |
| Business partners (suppliers, clients, and subcontractors)
| · Daily business activities · Production and sales trend briefing sessions · Policy explanation meetings · Questionnaire surveys |
| Communities | · Information exchange sessions with local communities and municipalities · Factory tours · Employee involvement in community activities |
| The environment
| · Exchange of information and dialogue with communities and NPOs/NGOs |
What actions were taken by the Yamaha Group to promote sustainability among its suppliers?
In its 2021 Sustainability Report the Yamaha Group reports that it took the following actions for promoting sustainability among its suppliers:
- Implementing a Supplier CSR Code of Conduct
- Yamaha Group’s supply contracts clearly state that suppliers are expected to comply with the Yamaha Supplier CSR Code of Conduct, and the Yamaha Group requests that suppliers conduct regular self-assessments with this regard. The Yamaha Supplier CSR Code of Conduct contains items pertaining to labour, human rights, the environment, and other sustainability considerations. Inspections based on this code of conduct are conducted when transactions are commenced with new suppliers and on a regular basis thereafter. Corrective measures are implemented and transactions are reconsidered as necessary.
- Assessing suppliers
- In fiscal 2020, a simultaneous supplier self-assessment was administered by the Yamaha Group to 3,748 companies, and results reports were received from 3,694 companies (a response rate of 98.6%). Corrective actions were requested of 11 companies deemed to have management system deficiencies based on assessment results, and documents indicating improvements have since been received from nine of these companies. The Yamaha Group intends to discontinue transactions with the other two. Of the 54 suppliers not subjected to this assessment, 38 were determined to be low risk due to having achieved compliance with or certified under sustainability-related standards, such as those of the Responsible Business Alliance. Of the other non-assessed companies, the Yamaha Group plans to discontinue transactions with nine, and will continue to request that the remaining seven comply with the Yamaha Supplier CSR Code of Conduct. Assessments of whether transactions can be continued with these suppliers will be conducted when formulating procurement policies and plans. In fiscal 2021, 149 potential suppliers conducted self-assessments, as part of the process of examining the possibility of commencing transactions.
- Providing training
- The Yamaha Group promotes internal training for its employees responsible for procurement to ensure fair trade. Topics of this training include the Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors (Subcontractors Act), laws related to contracts, and various regulations related to trade and procured goods. In addition, responsible procurement training is provided to employees charged with assessing the status of compliance with the Yamaha Supplier CSR Code of Conduct at suppliers. In fiscal 2021, briefings related to sustainable timber procurement, which included confirmations of timber legality, were conducted in Japan, China, and Indonesia.
- Engaging suppliers
- In Japan, the Yamaha Group works together with suppliers and subcontractors to contribute to worker safety and environmental preservation, while striving to foster an atmosphere in which it is easy to share thoughts through relationship-building activities. In addition, the Yamaha Group holds lectures on the United Nations Sustainable Development Goals (SDGs) at gatherings of suppliers in Japan, in an effort to promote sustainability together with suppliers. During these lectures, the Yamaha Group provides overviews of the SDGs and introduces Group initiatives related to human rights and other matters. Furthermore, it confirms the status of compliance and CSR measures at the waste treatment subcontractors used by domestic production sites through site visits and other measures.
Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?
The GRI Standards addressed in this case are:
1) Disclosure 308-1 New suppliers that were screened using environmental criteria
2) Disclosure 308-2 Negative environmental impacts in the supply chain and actions taken
3) Disclosure 414-1 New suppliers that were screened using social criteria
4) Disclosure 414-2 Negative social impacts in the supply chain and actions taken
Disclosure 308-1 New suppliers that were screened using environmental criteria does not correspond to any SDG.
Disclosure 308-2 Negative environmental impacts in the supply chain and actions taken does not correspond to any SDG.
Disclosure 414-1 New suppliers that were screened using social criteria corresponds to:
- Sustainable Development Goal (SDG) 5: Gender Equality
- Targets: 5.2
- Sustainable Development Goal (SDG) 8: Decent Work and Economic Growth
- Targets: 8.8
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.1
Disclosure 414-2 Negative social impacts in the supply chain and actions taken corresponds to:
- Sustainable Development Goal (SDG) 5: Gender Equality
- Targets: 5.2
- Sustainable Development Goal (SDG) 8: Decent Work and Economic Growth
- Targets: 8.8
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.1
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References:
This case study is based on published information by the Yamaha Group, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original please revert to the following link:
https://www.yamaha.com/en/csr/download/pdf/sr_2021_en.pdf
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