Promoting CSR and Green Purchasing ActivitiesAkebono’s consideration for the environment and CSR begins at thematerial procurement stage. Based on “Green Purchasing*Guidelines” formulated in fiscal 2005 (revised in fiscal 2011),Akebono works with suppliers to selects materials, secondary materialsand parts that have lower environmental loads.Akebono is striving to bring its environmental management to ahigher level by encouraging suppliers to obtain ISO 14001 and otherexternal certifications.Response to the Conflict Minerals** IssueThe U.S. Congress passed the “Conflict Minerals Rule,” which aimsto cut off sources of funding for armed groups in the DemocraticRepublic of Congo and neighboring countries. The rule requires publicdisclosure and reporting related to “conflict minerals” on manufacturers,obliging them to thoroughly track the origins of mineralsthat suppliers handle.Akebono is working with the Japan Automobile ManufacturersAssociation, Inc. (JAMA) and Japan Auto Parts Industries Association(JAPIA) to meet the requirements in a systematic manner. In fiscal2012, Akebono conducted preliminary research and established atracking system that does not impose excessive burdens on its suppliers.The system will be implemented step by step from fiscal2013.Global Suppliers’ Meetings HeldAkebono holds a suppliers’ meeting every year as an effort tostrengthen the partnership with its suppliers. During fiscal 2012, inaddition to the meeting in Japan, it held similar events in the UnitedStates and Indonesia. By sharing our policy on management, quality,R&D and procurement as well as latest industry trends and our newtechnologies, we seek to achieve greater synergy with our suppliers.Rooting Our Global Operations in Local CommunitiesA high regard for human rights is fundamental to our global operations,including the selection of local suppliers. We do not selectsuppliers based solely on cost; we confirm that they comply withlaws and are free of child labor and other human rights violations.We will be directing our focus more toward social and environmentalconsiderations as we build long-term relationships with oursuppliers.Suppliers’ meeting held in Jakarta (March 15, 2013)Suppliers’ meeting held in Tokyo (February 5, 2013)Environmental ManagementInitiatives at the Purchasing StageWe aim to deliver greater environmental quality byworking together with our suppliers.* Green purchasingThe affirmative selection and acquisition of products that cause less negative environmentalimpact. Scope of products covers materials, secondary materials, officearticles and equipment used in the course of manufacturing. Manufacture of “GreenProducts” requires the practice of green purchasing.**Conflict Minerals: The Section 1502 of the Dodd-Frank Act targets minerals containingtungsten, tantalum, gold, tin and other metals produced in the DemocraticRepublic of Congo and neighboring countries that provide sources of funding forarmed groups involved in the conflict.††† GADSL (Global Automotive Declarable Substance List)A list of chemical substances requiring proper management formulated by automobilemanufacturers, their parts suppliers and material suppliers in Japan, the UnitedStates and Europe. It is an industrywide standard, targeting the following substances,which are possibly contained in parts and materials supplied to automotive manufacturers:1. Substances that are subject to regulation under the laws of each country2. Substances that are expected to come under legal regulation3. Substances with a proven negative impact on health and/or the environmentThe list contains substances classified into such categories as “Substances prohibitedfrom use in all applications,” “Substances prohibited from use in certain applicationsor that must be declared if used” and “Substances that must be declared ifusage exceeds defined threshold limits.”Targeted chemical substances are categorized into three ranks and controlled as follows:Rank Chemical substances Examples of control measuresUsageprohibitedSubstances that are strictlybanned from use and productionby law and regulationProhibit use/draw up plansfor abolishment if there issubstance in useUsagerestrictedSubstances which are projected tocome under legal regulation andsubstances for which emissionregulations are set under existinglawsConduct research on alternativematerials or reductionmethods and draw up reductionplanPropermanagementof usageinformationrequiredSubstances listed in GADSL,†††that is, substances requiringdeclaration of usage amountEnsure proper managementof usage information andwork toward reduction ofusageRanking and Management of Environmental LoadSubstances under Green Purchasing Guidelines