AKEBONO REPORT 2014

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Promoting CSR and Green Purchasing ActivitiesAkebono’s consideration for the environment and CSR begins atthe material procurement stage. Based on “Green Purchasing*1Guidelines” formulated in fiscal 2005, Akebono works with suppliersto selects materials, secondary materials and parts that havelower environmental impact, with the aim of ensuring compliancewith regulations on environmental impact substances throughgreen procurement activities involving the entire supply chain.Akebono is striving to bring its environmental management to ahigher level by encouraging suppliers to obtain ISO 14001 andother external certifications.Response to the Conflict Minerals*2 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 requirespublic disclosure and reporting related to “conflict minerals” onmanufacturers, obliging them to thoroughly track the origins ofminerals that suppliers handle.Akebono is working with the Japan Automobile ManufacturersAssociation, Inc. (JAMA) and Japan Auto Parts IndustriesAssociation (JAPIA) to meet the requirements in a systematic manner.In fiscal 2013, Akebono initiated full-scale tracking. Based onits results, Akebono is determined to improve and apply its trackingsystem in fiscal 2014.Suppliers’ Meetings Held around the WorldAkebono holds suppliers’ meetings every year to facilitate theirunderstanding of the Company’s initiatives. During fiscal 2013,such meetings were held in Japan, North America, Indonesia andThailand. We gave presentations on each business unit’s policiesaimed at achieving the goals of our current midterm business planwhile sharing information on our initiatives undertaken in regionsworldwide. Also, we urged them to pursue quality enhancementactivities and ongoing cost reductions.We will continue to utilize these meetings to maintain robustcommunications aimed at building close partnerships betweensuppliers and our development, quality assurance and purchasingsections.Initiatives at the Purchasing StageAkebono aims to deliver greater environmental quality by working together with its suppliers.Suppliers’ meeting in Thailand(February 13, 2014)General suppliers’ meeting in Japan(February 5, 2014)Suppliers’ meeting in North America(April 9, 2014)Ranking and Management of Environmental ImpactSubstances under Green Purchasing GuidelinesTargeted chemical substances are categorized into three ranks and controlled as follows:Rank Chemical substancesExamples ofcontrol measuresUsage prohibitedSubstances that are strictlybanned from use andproduction by law andregulationProhibit use/draw upplans for abolishment ifthere is substance in useUsage restrictedSubstances which areprojected to come under legalregulation and substances forwhich emission regulationsare set under existing lawsConduct research onalternative materials orreduction methods anddraw up reduction planPropermanagement ofusage informationrequiredSubstances listed in GADSL*3,that is, substances requiringdeclaration of usage amountEnsure propermanagement of usageinformation and worktoward reduction of usage*1 Green purchasingThe absolute selection and acquisition of products that cause less negative environmentalimpact. Scope of products covers materials, secondary materials, office articlesand equipment used in the course of manufacturing. Manufacture of “Green Products”requires the practice of green purchasing.*2 Conflict MineralsThe Section 1502 of the Dodd-Frank Act targets minerals containing tungsten, tantalum,gold, and tin produced in the Democratic Republic of Congo and neighboringcountries that provide sources of funding for armed groups involved in the conflict.*3 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 United Statesand Europe. It is an industrywide standard, targeting the following substances, whichare 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 if usageexceeds defined threshold limits.”Suppliers’ meeting in Indonesia(February 11, 2014)

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