Approach

The SMM Group places importance on compliance in business activities based on the SMM Group Corporate Philosophy and the SMM Group Code of Conduct. As expressed in the Code of Conduct, compliance at the SMM Group means that we go beyond just complying with laws, regulations, Articles of Incorporation, and our own rules, and work to fulfill the social and moral responsibilities demanded of us as a member of society through corporate activities. We continue to advance various initiatives based on this fundamental approach.

Initiatives

Initiatives to Take on Issues and Provide Improvements

n FY2020 we formulated the following Group-Wide Compli-ance Goal and compliance priorities, and promoted initiatives to reach these in each department.

FY2020 Group-Wide Compliance Goal

Zero compliance violations that may seriously damage business

Compliance priorities

  1. Prevent recurrence of past compliance violations.
  2. Create workplaces that can respond appropriately to compliance violations should any occur.

Also, the Compliance Working Group was convened in FY2020, confirming the following.

  • The results of checking FY2020 compliance status show that there were no serious legal or regulatory violations, including cases of corruption or breaches of the Antimonopoly Act, regarding the environment, products, service, marketing, or taxes.
  • Progress is being made toward achieving targets set by each division in accordance with the Group-Wide Compliance Goal and compliance priorities for FY2020.

Furthermore, in FY2020, with regard to the conduct of tax affairs associated with the SMM Group’s business activities, we worked to formulate Group guidelines that place importance on compliance focus, maximization of corporate value, and appropriateness and fairness in accordance with the SMM Group Corporate Philosophy to make positive contributions to society and fulfill our responsibilities to stakeholders through the performance of sound corporate activities, in order to win ever greater trust. The Sumitomo Metal Mining Group’s Basic Policy on Taxes was established as the Basic Pol-icy on April 1, 2021.

To address the risk of serious violations of the law in our Group, we have established the following company regulations and are working to prevent legal violations.

  • Regulations on insider trading prevention and information management
  • Regulations on the safeguarding of personal information
  • Regulations for export control
  • Regulations for the prevention of bribery
  • Regulations for observance of competition law, etc.

Initiatives on Export Control

Based on the regulations for export control, the SMM Group has established the Export Control Committee and strives for compliance with the Foreign Exchange and Foreign Trade Act and other laws and regulations related to exports. In FY2020, we held training on export trade control, security export control, and classification methodology for a total of 243 employees engaged in export-related work at SMM Group companies to explain the legal system and inform participants about the precautions to be taken in their work.

Initiatives on Preventing Corruption

The SMM Group formulated the Basic Policies for Anti-Bribery and regulations for the prevention of bribery in April 2017. Revisions were made in April 2019, including the introduction of the prior approval system (a system that requires prior approval by an authorized person when seeking to provide benefits to public officials, etc. in certain cases in both Japan and overseas). In FY2020, we surveyed the status of implementation of the prior approval system introduced through the revisions at SMM Group companies during FY2019. The results of the survey confirmed there were no legal issues.

Compliance with Competition Laws

In April 2019, the SMM Group formulated its Basic Policy for Compliance with Competition Laws and we have established regulations for observance of competition law based on this policy. We have also prepared a manual on competition with compliance laws covering the content of the Basic Policy and regulations. In FY2020, we launched new initiatives, such as considering the introduction of new internal systems based on the status of legal revision and enforcement in each country since April 2019. We will continue responding to the latest situation going forward.

Hotline (Speak Up System)

In situations where problems or doubts under the SMM Group Code of Conduct occur, and consultation with superiors fails to bring forth an appropriate response, employees are able to use the internal reporting hotline (Speak Up System) to directly report the matter to: (i) in-house liaisons which are the general managers of the Legal Department, the Safety & Environment Control Department, and the Internal Audit Department; or (ii) outside liaisons which are designated attorneys. The source of the information is always kept secret and if, for any reason, the informant is treated unfairly, the person who initiated the unfair treatment will be punished appropriately.

Number of Consultations through the Speak Up System (FY2020)

Category Number
Consultations related to harassment 8
Consultations related to human resources, labor manage-ment, and salaries 4
Total 12

All consultations were handled appropriately.

Participants of Compliance Education (FY2020)

Type of seminar Target Participants
Compliance seminar for general managers Compliance seminar for officers
JCO Study Center training
Training for new employees
Training for mid-career hires
Seminar for newly promoted employees (section managers, E-class, S-class)
Officers 39
Employees 448

SMM Group Code of Conduct

All officers (including executive officers) and staff (including fixed-term and temporary employees) shall, in accordance with the corporate philosophy of the SMM Group, comply with the following Code of Conduct.

Code of Conduct for All 0fficers and Staff

1. Compliance: Abidance by Laws and Rules

  • We will comply with foreign and domestic laws and rules, and conform to social norms.
  • We will never under any circumstances commit an infraction of the law or act counter to social norms, even if doing so would seem to be in the company’s interests.

2. Respect for Individuals

  • We will accept diversity and respect the individuality and rights of people.
  • We will never violate human rights, engage in discriminatory conduct, or contribute to such conduct.

3. Assurance of Health and Safety

  • We will give highest priority to ensuring the physical health and safety of all persons affected by our operations.

4. Development of Human Resources

  • We will strive not only for personal self-improvement, but also to nurture successors through systematic training and by providing various opportunities in the course of work.

5. Risk Management

  • We will strive to identify risks, prevent their occurrence, and if risks occur, minimize the effects.

6. Adherence to a Progressive Stance

  • We will approach our jobs with a positive and progressive attitude suitable to the creation of technologies and systems in the vanguard of changing times.

7. Respect for Teamwork, Promotion of Good Communication

  • We will place high value on teamwork, in the form of cooperation both with other organizations and with fellow workers.
  • We will strive to create a cheerful and broad-minded corporate atmosphere conducive to the smooth transfer of required information and the timely performance of reporting, liaison and consultation.

8. In Harmony with Society and Local Communities

  • As members of society, we will participate in social contribution activities in accordance with our personal beliefs.
  • We will strive toward a harmonious and mutually beneficial relationship with local communities.

9. Separation of Corporate Business and Personal Affairs

  • We will at all times conduct ourselves based on sound judgment, and make a clear distinction between corporate business and our personal affairs.

10. Collection, Management and Usage of Information

  • We will collect information swiftly, properly and lawfully, manage it appropriately, and use it effectively.
  • We will utilize information acquired in con-junction with corporate business expressly for that purpose only, and will not leak such information to any third party.

11. Handling of Intellectual Property

  • We will nurture and maintain conscious recognition of the importance of intellectual property as a vital asset of the Group, and strive toward the creation of such property.
  • We will strive to properly protect and effectively use all corporate intellectual proper-ties; we will also respect intellectual properties of other parties.

12. Assurance of Quality

  • We will continuously improve quality management systems and provide products and services that satisfy customers.
  • We will enhance technologies and seek to engage in manufacturing that takes into account customers’ safety and their environment.

13. Stance toward Performance of Sales and Purchasing

  • We will comply with competition laws and conduct sales and purchasing activities based on fair competition.

14. Stance toward Entertainment and Gifts

  • We will entertain and present gifts to others, and accept entertainment and gifts, within the proper limits of both the law and social acceptability.
  • We will comply with laws against bribery and will maintain healthy and proper relationships with government and political organizations.

15. Severance of Relationships with Socially Disruptive Forces

  • We will staunchly eliminate socially disruptive forces and have no relations whatsoever with them.

16. Concern for the Global Environment

  • Taking into consideration climate change and biodiversity, we will act in a manner enabling us to contribute to the resolution and/or improvement of resource, energy and environmental problems of global scale.

17. Attitude in the Performance of Global Business Activities

  • We will strive to interact with people in the countries or regions where we undertake business and engage in conduct that respects local culture and practices as well as globally accepted norms and their spirit.