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Basic Policy for Raw Materials Procurement

Hokuetsu Kishu Paper's "Basic Policy for Raw Materials Procurement"

Hokuetsu Kishu Paper pursues raw material procurement in which value is placed on partnerships with suppliers based on the basic philosophy of the Hokuetsu Kishu Paper Environmental Charter to provide products that customers can use with assurance.

1. Priority on environment

  • With the Environmental Charter of Hokuetsu Kishu Paper as the basis for raw materials procurement, we will purchase raw materials that our customers can use with a sense of reassurance.
  • We will procure overseas wood resources from plantations. We will expand our overseas plantation programs and increase the use of wood resources harvested from our own forest resources. For domestic procurement, we will make use of and cultivate satoyama managed coppice and promote the utilization of unused materials.
  • We will promote the procurement of wood materials that takes into consideration biodiversity conservation and worker health and safety.

2. Open and fair trade

  • We will open our doors to all suppliers and engage in fair and open trade.

3. Legal compliance and disclosure of information

  • We will procure raw materials that are in compliance with relevant laws.
  • We will take steps to confirm that the wood materials purchased from our overseas suppliers were produced at appropriately managed forests, and through investment in overseas supplier companies and direct trade transactions. We will disclose information regarding our wood chip sources.

4. Mutual trust and prosperity

  • We will build history and trust with our business partners, and pursue best procurement practices in the environment, safety, quality, and cost dimensions under a spirit of co-existence and co-prosperity.

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Hokuetsu Kishu Paper's "Basic Policy for Raw Materials Procurement"

Basic Concept

  • Based on our "Basic Policy for Raw Materials Procurement" Hokuetsu Kishu Paper engages in procurement to ensure that the wood materials we use have been grown based on sustainable forestry management principles and in accordance with the law.
  • Specifically, the Group defines wood materials that do not originate from the following five sources as wood materials obtained through legal methods, and procure only such materials.
  • (1) Illegally harvested wood.
  • (2) Wood harvested in violation of traditional and civil rights.
  • (3) Wood harvested in forests where high conservation values are threatened by management activities.
  • (4) Wood harvested in forests being converted to plantations or non-forest use.
  • (5) Wood from forests in which genetically modified trees are planted.

Measures for Procurement

Imported Wood Chips

  • Wood chips purchased from overseas as raw materials for the manufacture of paper are 100% sourced from planted forests and are procured either directly from the supplier or via a trading company.
  • Each year we obtain from each supplier the information detailed below and a signed declaration that the wood materials being supplied do not originate from any of the sources detailed in points (1) to (5) above. This is treated as the basic information for the wood materials used by our Group. If necessary a company employee is dispatched to the procurement site to confirm the accuracy of the information.
  • * Company name and address
  • * Acquisition status of forest certification
  • * Name of species, source of wood materials and region of collection
  • * Name of sapling producer and location of production
  • * Applicable laws, regulations and managements systems

Imported Pulp

  • Wood pulp purchased from overseas as raw materials for paper production is in principle either from certified or controlled forests and is procured either directly from the supplier or via a trading company.
  • Information concerning the forest certification of the purchased pulp is obtained from the supplier and treated as the basic information for the wood materials used by our Group. Hokuetsu Kishu Paper employees engage in activities to confirm the veracity of this information.

Domestic Wood Chips

  • The wood chips that we collect domestically as raw materials for paper production are sourced from sustainable satoyama (managed coppice) and are procured from supplier companies, including our subsidiary Hokuetsu Forest Co., Ltd.
  • In the same way as for imported wood chips, each year we obtain from each supplier a signed declaration and information on the wood materials collected, which is treated as the basic information for the wood materials used by our Group. Hokuetsu Kishu Paper employees engage in activities to confirm the veracity of this information.

Domestic Pulp

  • A basic condition for wood pulp purchased domestically as raw materials for paper production is that it can be proven to be a wood product of verifiable legality.

Measures to Ensure Verifiable Legality in Procurement

(1) Elimination of Non-certified Forests

  • In the case that efforts are made to procure wood chips or pulp that do not originate from certified or controlled forests, we implement a risk assessment of the wood materials in question and only purchase them if it can be verified and confirmed that they fulfil wood control criteria stipulated by certifying agencies.

(2) Utilization of a Traceability System

Imported Wood Chips
  • For each shipping consignment we require suppliers to submit a traceability report containing information about the wood materials on board, from which we confirm that we are engaged in production using materials of verifiable legality.
Imported Pulp
  • We require suppliers to submit a regular traceability report containing information about the wood materials supplied to our company as pulp, from which we confirm that we are engaged in production using materials of verifiable legality.
Domestic Wood Chips
  • We require each domestic supplying company to submit a traceability report for the previous fiscal year (from April of the previous year to March of the current year) containing information about wood materials, from which we confirm that we are engaged in production using materials of verifiable legality. In addition, to the greatest extent possible we also require suppliers to submit additional documentation for confirmation purposes (e.g. Report on felling of trees, contracts, wood materials acquisition confirmation slip, etc.)
Audit and Information Disclosure
  • We aim to further improve the precision of the traceability system (confirmation the legal status of wood materials) through the implementation of regular third party audits.
  • Various information, including tree species, procurement location, details concerning legality and the content of third party audits are disclosed in the company's Corporate Report.

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