Our business partners are important members of our value chain, who supply the materials, parts and components necessary for the continued operation of our manufacturing enterprise. At Komatsu, we aim to build a Win-Win relationship with our business partners by making interactive efforts under a relationship of mutual trust. Along with the expansion of our global operation, our supply chain has also been expanding all over the world. Taking seriously the recent gain of momentum for the spread of CSR in the overall supply chain, we are working to realize CSR procurement globally by being proactive in providing intense support for the CSR initiatives of our business partners.
Komatsu's procurement policy is based on the philosophy of aiming to build a Win-Win relationship with our business partners, who are on an equal footing with us, and encouraging each other. The policy aims to evaluate and select suppliers in a fair and equitable manner from a SLQDC (Occupational health & Safety, Compliance with the Law, Quality, Production capacity & delivery and Cost competitiveness) and ESG perspective.
As evaluation criteria for selecting suppliers and evaluating ongoing transactions, Komatsu has established CSR Procurement Guidelines and Green Procurement Guidelines, which are published on our website. In addition to making these guidelines known to our suppliers, we strive to ensure that their business activities align with these guidelines by providing necessary support and guidance. Our support and guidance include the following examples:
To promote CSR activities throughout the supply chain, we established and released the "CSR Procurement Guidelines" in 2011. These guidelines, in line with international standards such as ISO 26000 and the 10 principles of the United Nations Global Compact, integrate Komatsu's code of conduct and the Komatsu Way. They outline the expectations we have for our business partners, covering a broad range of ESG issues, including corporate governance, compliance, environmental protection, human rights and labor, corporate ethics, social contribution, and coexistence with local communities. Efforts to comply with these guidelines are incorporated into our business contracts with partners. If a clear violation of these guidelines is identified at a partner company, and appropriate corrective actions are not taken within a certain period of time, we may suspend or terminate our business relationship with that company.
In accordance with the Komatsu Code of Worldwide Business Conduct (established in 1988), all companies of the Komatsu Group have worked together in pursuit of thorough compliance. Moreover, Komatsu has focused on corporate social responsibility (CSR) in its business management with the aim of coexisting with society and achieving sustainable growth. As part of this effort, Komatsu has participated in the Global Compact, a voluntary principle of action in relation to “human rights, labor, environment and prevention of corruption” advocated by the United Nations, since November 2008 and has also expressed its position as a global enterprise on critical issues confronting international society faces.
Against this backdrop, ISO26000 was officially issued in November 2010 to provide international guidance on social responsibility. Komatsu sincerely reacts to the issues set forth in ISO26000 and will exercise leadership so that social responsibility will be borne throughout the entire value chain.
According to the Komatsu Code of Worldwide Business Conduct, we shall “seek to establish long-lasting stable relationships on the basis of mutual trust” by considering business partners to be important partners of the Komatsu Group. The revision in April 2011 added statements that we shall encourage business partners to follow the spirit of Komatsu Code of Worldwide Business Conduct and that the criteria for the selection of business partners shall include their compliance with rules of business society.
The CSR Procurement Guidelines contain a list of practices recommended for our business partners in line with the basic policy above, covering compliance and CSR. Since its establishment in 2011, we have revised it to address new issues that meet the social needs. Companies of the Komatsu Group are kindly requested to take note of and incorporate the guidelines into their management principles and unfailingly promote CSR. Moreover, we hope that these companies make similar requests to their suppliers.
April 1, 2025
Daisuke Ban, President of Komatsu Procurement Division
(Established on August 30, 2011; Revised on April 1, 2019, on April 1, 2021 and on April 1, 2024)
(1) Build a system or operational structure designed to meet various risks.
(2) Establish legal and transparent decision-making processes concerning management.
(3) Conduct appropriate accounting procedures, tax ling and settlement of accounts.
(4) Place importance on communication with stakeholders (customers, shareholders, business partners,employees, community etc.).
(5) Ensure that top management will be notied promptly when any abnormal condition develops and that your company will be able to promptly and accurately respond to the situation(s).
(6) Fulll accountability to society through active disclosure of corporate information.
(7) Properly handle the personal information of customers, business partners and employees. Take appropriate measures for information security to ensure that the condential business information provided by Komatsu or by business partners will not be leaked, lost or destroyed.
(8) Create an eective BCP so that, even in the event of large-scale natural disaster, infectious disease pandemic or any other emergency, we can appropriately take initial measures to ensure the safety of employees, quickly restore business operations and fulll our responsibility to supply customers with products.
(1) Engage in business operations while complying with the laws and regulations, as well as the rules of the business community in the countries and regions where we conduct business operations. In addition, make eorts to respect internationally accepted standards.
(2) Dene a code of conduct, comprising company rules, under the leadership of senior management, and develop a corporate climate that places top priority on compliance.
(3) Establish a compliance regime, in accordance with the scale and characteristics of the company, that prevents the company, executives, and employees from engaging in illegal conduct, and promptly addresses situations where issues have occurred (e.g. a whistle-blowing system).
(1) Comply with the laws and regulations concerning product safety and deliver products and services which will oer safety and peace of mind to customers.
(2) In addition to maintaining the quality and cost competitiveness of products and services which your company delivers to customers, stand by the agreed upon date of delivery and supply your products in a stable manner.
(3) Establish a quality management system and make eorts to maintain and improve it.
(4) Constantly engage in technology development and provide innovative, safe and environmental-friendly products and services.
(1) Continue efforts to reduce environmental impact resulting from business operations.
(2) Appropriately manage chemical substances contained in products.
(3) Build up environmental management systems such as the ISO14000 series and "Eco Stage."
(4) Pollutant air and water, other wastes, noise, vibration, etc. that affect the health and living environment of community, must be appropriately managed and disposed of in accordance with relevant laws and regulations.
(1) Respect human rights including the rights to freedom of association and collective bargaining.
(2) Never get involved, directly or indirectly, in any child or forced labor.
(3) Create a work environment where there is no discrimination or harassment in any aspect of employment.
(4) Respect the rights of workers, through payment of fair wages and proper working hours management.
(5) Establish a system for occupational labor health and safety, under the leadership of top management, and create a working environment where all employees can work safely and healthily.
(6) Establish fair and equitable human resource system, and pay attention to human resource development and employee education as well.
(7) Give consideration to improving communication between top management and employees.
(8) Prevent using raw materials (such as conflict minerals, deforestation, etc.) that may cause social issues by combining environment and human rights.
(1) Comply with all related laws and regulations and engage in free and fair competition and business transactions.
(2) Respect intellectual properties of other parties and work to prevent infringement thereof.
(3) Never accept inappropriate cash, gifts or other favors from any civil servant or stakeholder (customer or business partner) either domestically or internationally.
(4) Carry out proper foreign trade transactions (goods and technologies) while complying with the related laws and regulations.
(5) Never have any relationship with antisocial forces or groups.
(6) Never engage in any transactions that may result in a conflict of interest or that may have the potential.
(1) Engage in social contribution activities based on your company's management principle(s) and support employees' volunteer activities.
(2) Place importance on co-existence with local communities which is the foundation of your business, and proactively support the growth of local communities.
(1) Encourage business partners of the company to observe the items stipulated in the guidelines. Make efforts to encourage the spread of these guidelines into the entire supply chain.
The Green Procurement Guidelines are a supplementary addition to the environment-related issues included in the CSR Procurement Guidelines. In 1992, Komatsu established the "Komatsu Earth and Environment Policy," declaring its commitment to environmentally conscious business activities to achieve a sustainable society.
Through these guidelines, we prioritize green procurement of raw materials and procured components/parts, which are essential elements in our production. We also encourage our business partners to engage in environmental management and activities to reduce environmental impact.
In relation to these guidelines, we have also conducted the following surveys in our supply chain.
From a CSR perspective, Komatsu has a policy of not using "conflict minerals," such as tin, tantalum, tungsten, and gold (3TG), sourced from the Democratic Republic of Congo and surrounding countries. This policy is communicated to our business partners through the "Green Procurement Guidelines." Between 2011 and 2014, using the Japan Auto Parts Industries Association (JAPIA) survey template (JAPIA sheet), we conducted investigations on the content and origin (upstream smelters) of these minerals in parts supplied by our partners. The results indicated that the amount of these minerals used in our products is negligible, and we have not used any "conflict minerals." Since then, we have continued to monitor this issue through CSR-related SAQ questionnaires and human rights due diligence surveys.
In the future, if the use of "conflict minerals" is identified in our company or among our business partners, we will promptly switch to procurement from smelters certified by RMI.
The REACH regulation governs the registration, evaluation, authorization, and restriction of chemical substances in the EU. Companies that manufacture target chemical substances in the EU or export finished products containing target chemical substances to the EU must comply with this regulation and apply for registration and authorization if the annual use of these substances exceeds certain amounts. Substances subject to the regulation, especially those classified as Substances of Very High Concern (SVHC), are updated annually. Like our approach to conflict minerals, Komatsu uses JAPIA sheets to survey the content of regulated substances in each component from our business partners and reports the findings to the EU authorities. Additionally, we work closely with our partners to reduce the use of SVHCs and to transition to verified safe alternative substances.
The Partnership Declaration is our voluntary code of conduct and states that a large company, or parent enterprise, shall partner and cooperate with small and medium companies with the aim of facilitating their coexistence and coprosperity and shall, in fair dealing with the small and medium companies, enhance the added value of the supply chain overall.
Komatsu announced the declaration in August 2020, expressing its support for the activities implemented by the Cabinet Office, the Small and Medium Enterprise Agency and different economic organizations.
Komatsu complies with the rules and regulations stated in the Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors and in the promotional standards of the Act on the Promotion of Subcontracting Small and Medium-sized Enterprises. Moreover, Komatsu will continue to help its business partners to become organizationally stronger by providing support for their efforts to enhance productivity and streamline work with the use of ICT and by providing training programs.
In July 2022, the basic principles (Article 3) of the Act on the Promotion of Subcontracting Small and Medium-sized Enterprises were revised. In response, Komatsu issued a letter to /en/csrall domestic Tier-1 suppliers, including sub-materials suppliers, encouraging them to reflect fluctuating raw material, energy, and labor costs in product prices. We are actively promoting the optimization of purchasing prices. In 2024, we held price negotiations with 1,207 companies and proactively implemented necessary price adjustments. We will continue to hold price negotiations with our suppliers at least once a year from 2025 onwards.
In January 2023, we launched the "Supplier Portal (KOMATSU Global portal)," a website for sharing information with our business partners. This site allows both our employees and business partners to share daily order and production data, and utilize tools that facilitate data processing and analysis. By using this portal, it is possible to detect fluctuations in production and orders, and anticipate the demand for intermittent production parts. Additionally, it enables the monitoring of management indicators such as delivery date achievement rates and defect rates. As of May 2025, approximately 1,100 companies are using the website. Moving forward, we will continue to enhance the portal's functionality and expand its content, striving to strengthen information sharing.
Please access the following website to read the Partnership Declaration.