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Hitachi evaluates and analyzes the state of sustainability initiatives by procurement partners from the viewpoint of risk management. We also visit the manufacturing sites of procurement partners to conduct sustainability audits for the purpose of identification of sustainability risks through the value chain and corrective actions against the risks.
by procurement partners
For the purpose of risk management and engagement with procurement partners, Hitachi evaluates and analyzes the state of sustainability initiatives at procurement partners.
Starting in FY2022, we adopted the EcoVadis third-party evaluation platform for monitoring and evaluating the sustainability performance of our procurement partners. We perform assessments regarding procurement partners who represent a large portion of our procurement and who are important to our business strategy. We confirm sustainability efforts based on a checklist covering four areas: environment, labor and human rights, ethics, and sustainable procurement. In FY2022, we conducted sustainability assessments of 1,374 procurement partners (in 48 countries) across the Hitachi Group. Of these, procurement partners that scored 65 points or higher, which is considered a "High level" of sustainability initiatives, accounted for approximately 20% of the total. We have started to present awards to procurement partners that have obtained such high scores at procurement partner events held at each business entity. In addition, we use the information obtained from these evaluations to identify companies requiring corrective action, to discuss and monitor improvement methods, and to select and conduct sustainability audits.
We are working towards further strengthening the engagement with our procurement partners.
To promote and ensure sustainable procurement, Hitachi conducts annual sustainability audits by visiting the manufacturing sites of procurement partners.
These audits check the sustainability initiatives of our procurement partners from the perspectives of “labor and human rights”, “health and safety”, “environment” and “ethics”.
From FY2022, we utilize EcoVadis to visualize sustainability risks in our value chain.
By understanding the sustainability risks of each procurement partner through the use of EcoVadis, we build a more transparent process of sustainability audits and corrective actions at procurement partners.
In FY2022, we conducted sustainability audits on 128 procurement partners, which we selected based on written surveys of EcoVadis and procurement spend. For any matters identified during the audit, we explain the details to our procurement partners and request improvements.
For procurement partners whose audit results indicate a high risk, we consider to carry out training to support the improvement of procurement partners, online monitoring, and follow-up audits.