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Akebono introduced its Green Purchasing Guideline in 2005, revising it in 2011. Under the guidelines we are considering the environment and CSR from the purchasing stage by working together with suppliers to procure materials, components, and secondary materials that have a low environmental impact. We are also encouraging our suppliers to improve their environmental management performance by recommending activities to acquire external accreditation such as ISO 14001.Ranking and Management of Environmental Impact Substances under Green Purchasing a GuidelinesTargeted chemical substances are categorized into three ranks and controlled as follows:The U.S. Congress passed the “Conict Minerals Rule,” which aims to cut off sources of funding for armed groups in the Democratic Republic of Congo and neighboring countries. The rule requires manufacturers to ensure public disclosure and reporting related to “conict minerals,” obliging them to thoroughly track the origins of minerals that are supplied to them.Akebono conducts investigations in accordance with industry standards from a CSR procurement perspective and has not found any use of conict minerals. Akebono is taking steps to ensure safety across its supply chains by working to eliminate occupational accidents. We urge our suppliers to create safer, more secure work places by raising the theme of safety at our suppliers meetings held throughout the world and in our Seiwa Kai study sessions consists of major suppliers.In cooperation with our suppliers, Akebono performs testing of purchased products to determine if they contain substances of very high concern (SVHC*) or banned substances. The tests are performed on the individual product level and their results are communicated back to the suppliers. Response to the Conict Minerals* IssueSupply Chain Safety PromotionResponse to Substances of Very High Concern*Promoting CSR and Green Purchasing** Green PurchasingGreen purchasing refers to the preferential selection and acquisition of products that cause less negative environmental impact. The scope of products covers materials, secondary materials, ofce articles and equipment used in the course of manufacturing. Manufacture of “Green Products” requires the practice of green purchasing.* Substance of Very High ConcernA substance may (but not necessarily must) be designated as SVHC if it meets one or more of the following criteria: it is carcinogenic, mutagenic or toxic for reproduction, and in addition is either persistent, bioaccumulative and toxic, or very persistent and very bioaccumulative. Such substances are identied as having probability of causing serious adverse effects to human health or the environment.* Conict MineralsSection 1502 of the Dodd-Frank Act targets minerals containing tungsten, tantalum, gold, and tin produced in the Democratic Republic of Congo and neighboring countries that provide sources of funding for armed groups involved in the conict.* GADSL (Global Automotive Declarable Substance List)A list of chemical substances requiring proper management formulated by automobile manufacturers, their parts suppliers and material suppliers in Japan, the United States 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 classied into such categories as “Substances prohibited from use in all applications,” “Substances prohibited from use in certain applications or that must be declared if used” and “Substances that must be declared if usage exceeds dened threshold limits.”Akebono is working to reduce environmental and social impacts in cooperationwith its suppliers. PurchasingInitiatives for Society and EnvironmentRankChemical substancesExamples of control measuresUsage prohibitedSubstances that are strictly banned from use and production by law and regulationProhibit use/draw up plans for abolishment if there is substance in useUsage restrictedSubstances which are projected to come under legal regulation and substances for which emission regulations are set under existing lawsConduct research on alternative materials or reduction methods and draw up reduction plan Proper management of usage information requiredSubstances listed in GADSL* that is, substances requiring declaration of usage amountEnsure proper management of usage information and work toward reduction of usageAKEBONO REPORT 201631