IDEC GroupCSR Procurement Guidelines

November 20th, 2023 （Second Edition）

－ Contents －Introduction

Purchasing Policy
Responsible Minerals Sourcing Policy

1. Labor

2. Health and Safety

3. Environmental

4. Ethics

5. Product Safety

6. Management System

7. External reporting desk

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Introduction
The IDEC Group is actively involved in Corporate Social Responsibility (CSR) activities. This isdue to the corporate mission which requires: “for all employees to respect humanity as we
contribute to society and economy through business growth.” Most importantly, we keep“spreading safety” and “contributions to the global environment” through our business at thecenter of those activities. Based on the “IDEC Group Corporate Ethics and Code of Conduct” andthe Ten Principles of the United Nations Global Compact, we aim for sustainable growth throughour business activities. In 2017, we established the “IDEC Group CSR Charter.” Here, based on
our corporate mission, “management with respect for humanity,” we declare that we will maximize
the happiness of all stakeholders surrounding the IDEC Group.
In addition, recent years have seen various changes in the CSR demands that society places on
businesses, in areas that include human rights and labor, health and safety, environmental
protection, and ethics. Responding to such demands has become a necessary condition ofbusiness continuity, and in light of such developments, the IDEC Group is advancing CSR
activities in priority areas referred to as ESG＋Sa＋Q, consisting of the environment (E), society(S), and governance (G) as well as IDEC’s own strengths of safety (Sa) and quality (Q).

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Based on these societal demands and in light of the need to identify to members of the IDEC Groupand its suppliers in more specific terms the Group’s thinking on CSR procurement, these IDECGroup CSR Procurement Guidelines were established and the first edition was published in August
2018.
Since then, we have had the opportunity to have our CSR procurement activities evaluated by athird party, and the Responsible Business Alliance (RBA) Code of Conduct, which we use as areference for our activities, has been revised, so we decided to revise these guidelines.
The Guidelines begin by introducing the revised Purchasing Policy intended to identify the IDECGroup’s basic approach to transactions with suppliers, followed by the Responsible Minerals
Sourcing Policy which has been newly established based on the provisions of this guidelines.
These Guidelines clearly identify matters with which suppliers are expected to comply based on ashared understanding of our corporate social responsibility.
Suppliers are requested to understand the main points of these Guidelines and implement thenecessary actions and activities to comply with each of the requirements herein.

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Purchasing Policy
In engaging in new transactions, the IDEC Group will provide an environment in which all
suppliers can trade with it in a fair and impartial manner. To increase customer satisfaction evenfurther, it will strive to build a supply-chain management (SCM) system on a global basis, seeking
to secure an extensive range of suppliers around the world. Together with aiming to procurematerials with outstanding quality, cost, and delivery (QCD) performance and low environmental
impact, it also will aim to realize coexistence and co-prosperity with suppliers as good business
partners, and contribute to a sustainable society.
GlobalTo enable global production activities, outstanding parts and materials shall be procured from global
suppliers in the optimal locations.

Fair and impartial

Pursuing equal opportunities for transactions, the Group will engage in fair transactions
regardless of company size or nationality. Relations shall be built based on mutual cooperationand trust through transactions reflecting comprehensive, fair evaluation of matters, such as
quality, price, delivery time, stability of supply, and CSR.

Green procurement
Procurement transactions shall be conducted in compliance with laws and regulations, andstandards related to environmental protection and proactive efforts shall be made to lessen
environmental impact through means, such as development of environmental management
systems together with suppliers, thorough management of chemical substances, and promoting
recycling of resources, to procure eco-friendly materials with low environmental impact.

CSR procurement
CSR procurement shall be advanced, based on consideration for matters, such as legal andregulatory compliance, respect for human rights, occupational health and safety, relevant efforts
for responsible minerals sourcing, environmental protection, coexistence with society, timely andappropriate disclosure of information, and protection of confidential information.

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Responsible Minerals Sourcing Policy
The IDEC Group will make the following commitments on sourcing of tantalum, tin, tungsten, andgold in the products manufactured by the Group.

1. The Group will not use minerals that are a source of funds for armed groups in ConflictAffected and High-Risk Areas defined by the Organisation for Economic Co-operation andDevelopment (OECD).
2. The Group will make efforts to source minerals from conflict-free smelters by performing due
diligence on the origin and distribution areas of minerals based on survey using the CMRT
(Conflict Minerals Reporting Template) and the EMRT (Extended Minerals Reporting
Template) issued by the RMI (Responsible Minerals Initiative).
3. In the unlikely event that the use of conflict minerals, which are a source of funds for armed
groups, is discovered, the Group will promptly take corrective action.

6. 1. LABOR
Business partners are committed to uphold the human rights of workers and to treat them with
dignity and respect as understood by the international community. This applies to all workers,
including temporary, migrant, student, contract, direct employees, and any other type of worker.

(1) Freely Chosen Employment■ In no case shall forced, bonded (including debt bondage), or indentured labor, involuntary or
exploitative prison labor, slavery, or human trafficking be used. (This includes transporting,harboring, recruiting, transferring, or receiving persons by means of threat, force, coercion,
abduction, or fraud for labor or services.)■ There shall be no unreasonable restrictions on workers’ freedom of movement in the facility
in addition to unreasonable restrictions on entering or exiting company-provided facilities.
■ As part of the hiring process, all workers must be provided with a written employment
agreement that contains the terms and conditions of employment. The written documents
have to be in English, but if workers can not understand English, they have to be in theirnative language.
■ Foreign migrant workers must receive the employment agreement prior to the worker
departing from his or her country of origin and there shall be no substitution or change(s)allowed in the employment agreement upon arrival in the receiving country unless thesechanges are made to meet local law and provide equal or better terms.
■ All work must be voluntary and workers shall be free to leave work at any time or terminate
their employment.
■ Employers and agents may not hold or otherwise destroy, conceal, confiscate or deny accessby employees to their identity or immigration documents, such as government-issued
identification, passports or work permits, unless such holdings are required by law.
■ Workers shall not be required to pay recruitment fees or other related fees for theiremployment. If any such fees are found to have been paid by workers, such fees shall be
repaid to the worker.

(2) Young Workers■ Child labor is not to be used in any work. The term “child” refers to any person under the ageof 15, or under the age for completing compulsory education, or under the minimum age for
employment in the country, whichever is greatest.

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■ The use of legitimate learning programs in workplace, which comply with all laws andregulations, is supported.
■ Workers under the age of 18 (Young Workers) shall not perform work that is likely tojeopardize their health or safety, including night shifts and overtime.
■ In accordance with laws and regulations, working records of student workers shall be
retained properly, checked strictly to ensure that instructors in the workplace provide student
workers with appropriate guidance, and managed to ensure that the rights of student
workers are protected fully.
■ In the absence of local law, the wage rate for student workers, interns, and apprentices shallbe at least the same wage rate as other entry-level workers performing equal or similar tasks.

(3) Working Hours■ A workweek is not to exceed the maximum set by local law.
■ Workers shall be allowed at least one day off every seven days.

(4) Wages and Benefits■ Business partners shall comply with all applicable wage related laws and regulations,
including those relating to minimum wages, overtime work, and legally mandated benefits.
■ Business partners shall pay extra wages for overtime work in accordance with local laws.
■ Business partners shall not reduce wages as a disciplinary measure even in cases subject
to disciplinary action.
■ At the time of payment, business partners shall provide workers understandable andaccurate wage statements that include sufficient information to verify compensation for work
performed.
■ Business partners shall pay wages and allowances to all workers based on local laws.

(5) Humane Treatment■ There is to be no harsh and inhumane treatment, including any sexual harassment, sexual
abuse, corporal punishment, mental or physical coercion, or verbal abuse of workers, nor isthere to be the threat of any such treatment.
■ Clear disciplinary policies and procedures shall be decided on for persons who have caused
any issues, such as those described above, and they shall be communicated to workers.

(6) Non-Discrimination■ Business partners should be committed to a workforce free of harassment andunlawful discrimination.
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■ Companies shall not engage in discrimination based on race, color, age, gender,

sexual orientation, gender identity and expression, ethnicity or national origin,disability, pregnancy, religion, political affiliation, union membership, covered veteranstatus, protected genetic information or marital status in hiring and employment
practices, such as wages, promotions, rewards, and access to training.
■ Business partners shall accommodate the needs of workers within a reasonable extent

for religious practices, as necessary.
■ Workers or potential workers should not be subjected to medical tests or physicalexams that could be used in a discriminatory way.
(7) Freedom of Association■ Business partners shall respect the right of all workers to form and join trade unionsof their own choosing, to bargain collectively and to engage in peaceful assembly,
and to respect the right of workers to refrain from such activities.
■ Workers and/or their representatives shall be able to openly communicate and shareideas and concerns with management regarding working conditions andmanagement practices without fear of discrimination, reprisal, intimidation, or
harassment.

2. HEALTH and SAFETY
Business partners shall recognize that in addition to minimizing the incidence of work-related
injury and illness, a safe and healthy work environment enhances the quality of products andservices, consistency of production, and worker retention and morale. Business partners shallalso recognize that raising worker awareness and education is essential to identifying and solving
health and safety issues in the workplace.

(1) Occupational Safety■ Worker potential for exposure to safety hazards (e.g., chemical, electrical and other energy
sources, fire, vehicles, and fall hazards) are to be identified and assessed, and controlled
through preventative maintenance and safe work procedures (including

lockout/tag-out*1 ), and ongoing safety training.

*1 Lockout and tag-out procedures are important means of protecting employees
engaged in the operation, service, inspection, and maintenance of machinery andequipment from danger. Lockout refers to locking machinery and equipment after9

first cutting off circuit breakers, switches, valves, and other sources of motive

power during inspection and maintenance. Tag-out refers to attaching a type of
warning tag to safe parts of a locked-out device. The machinery or equipment
must not be restarted until the tag has been removed. Lockout and tag-out areused simultaneously to demonstrate clearly that the source of motive power has
been cut off.

■ Where hazards cannot be adequately controlled by these means, workers are to be provided
with appropriate, well-maintained, protective equipment and educational materials aboutrisks to them associated with these hazards.
■ Reasonable steps must also be taken to remove or reduce any workplace health and safety
risks to pregnant women and nursing mothers, and provide reasonable accommodations fornursing mothers.

(2) Emergency Preparedness■ Emergency situations and events and their resulting impacts and damage are to be identified
and their content verified.
■ Damage due to emergency situations and events is to be minimized by regularly maintaining
emergency plans and response procedures, including emergency reporting, employee
notification and evacuation procedures, evacuation drills, appropriate fire detection andsuppression equipment, escape paths, and recovery plans.
■ Such plans and procedures shall focus on minimizing harm to life, the environment, andproperty.

(3) Occupational Injury and Illness■ Procedures and systems are to be in place to classify and record injury and illness cases,
provide necessary medical treatment, investigate cases and implement corrective actions toeliminate their causes, and facilitate return of workers to work.

(4) Industrial Hygiene■ Risk of worker exposure to chemical, biological, and physical agents in the workplace is

to be identified and risks eliminated or controlled through administrative controls asnecessary.

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■When hazards cannot be adequately controlled by such means, workers are to be protectedby being provided with and using appropriate, personal protective equipment andeducational materials.

(5) Physically Demanding Work■ Worker exposure to the hazards of physically demanding tasks, including manual material
handling, heavy or repetitive lifting, prolonged standing, and highly repetitive or forcefulassembly tasks is to be identified, evaluated, and controlled.

(6) Machine Safeguarding■ Necessary measures, such as use of protective railings, interlocking structures*2, andprotective walls shall be employed for machinery and equipment used for production and otherpurposes, and such machinery and equipment shall be maintained and managed to avoid
worker injuries.

*2 Interlocking is an approach to safety equipment and safety design in which otheroperation is not possible unless certain conditions are satisfied.

(7) Sanitation, Food, and Housing■ Workers are to be provided with ready access to clean toilet facilities, potable water andsanitary food preparation, storage, and eating facilities.
■ Worker dormitories provided by the business partners are to be maintained to be clean andsafe, and provided with appropriate emergency egress, hot water for bathing and showering,adequate lighting heat and ventilation, and reasonable personal space along with reasonableentry and exit privileges.

(8) Health and Safety Communication■ Business partners shall provide workers with appropriate workplace health and safety
training in the language the worker uses on a daily basis or can understand. Health andsafety related information shall be posted in the facility in a location identifiable andaccessible by workers.

3. ENVIRONMENTAL

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Business partners recognize that environmental responsibility is integral to producing world-classproducts. In manufacturing operations, adverse effects on the community, environment, andnatural resources are to be minimized while safeguarding general health and safety.

(1) Environmental Permits and Reporting■ All required environmental permits (e.g. discharge monitoring), approvals and registrations
are to be obtained, maintained, and kept current and their operational and reporting
requirements are to be followed.

(2) Pollution Prevention and Resource Reduction■ The use of natural resources, including water and energy, and the generation of waste are
to be minimized or eliminated at the source or by practices, such as modifying production,
maintenance and facility processes, materials substitution, conservation, recycling,re-use, or other means.

(3) Hazardous Substances■ Chemicals and other materials posing a hazard to humans or the environment are to be
identified and properly treated by safe handling, movement, storage, re-use, or other means.

(4) Wastewater and Solid Waste■ Business partners shall implement a systematic approach to identify, manage, reduce, andresponsibly dispose of or recycle solid waste (non-hazardous). In addition, they must strive
to analyze and monitor the content of wastewater discharged from manufacturing processes
and other activities and discharge or dispose of such wastewater only after implementing
necessary management and treatment based on the results of such analysis andmonitoring. They also must implement measures to reduce the generation of wastewater.
The performance of systems for handling and treatment of wastewater must be monitored
on a daily basis.

(5) Air Emissions■ Air emissions of volatile organic chemicals, aerosols, corrosives, particulates, ozone
depleting chemicals, and combustion byproducts generated from operations are to be
characterized, routinely monitored, controlled, and treated as required prior to discharge.
Business partners shall conduct routine monitoring of the performance of its air emission
control systems.

12(6) Materials Restrictions■ Business partners are to adhere to all applicable laws, regulations, and customer
requirements regarding prohibition or restriction of specific substances in products andmanufacturing, including classifying for recycling and disposal.

(7) Rain Water control■ Pollution due to outflow of rainwater must be prevented through systemic efforts. In addition,measures must be taken to prevent unlawful drainage and outflows from entering rainwater
pipes.

(8) Energy Consumption and Greenhouse Gas Emissions■ Energy consumption and greenhouse gas emissions are to be tracked and documented, atthe facility and/or corporate level. Business partners are to look for cost- effective methods toimprove energy efficiency and to minimize their energy consumption and greenhouse gas
emissions.

4. ETHICS
To meet social responsibilities and to achieve success in the marketplace, business partners are
to uphold the highest standards of ethics including the following:(1) Business Integrity■ The highest standards of integrity are to be upheld in all business interactions.
■ Business partners shall have a zero tolerance policy to prohibit any and all forms of bribery,corruption, extortion, and embezzlement.
■ All commercial transactions must be implemented with transparency and reflected accurately
in accounting ledgers.
■ Monitoring and other procedures must be implemented to ensure compliance with laws on
prevention of corruption.

(2) No Improper Advantage■ Bribes or other means of obtaining undue or improper advantage are not to be promised,offered , authorized, given, or accepted. This prohibition covers promising, offering,authorizing, giving, or accepting anything of value, either directly or indirectly througha third party, in order to obtain or retain business, direct business to any person, orotherwise gain an improper advantage.

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(3) Disclosure of Information■ Information regarding business partner labor, health and safety, environmental practices,business activities, structure, financial situation and performance is to be disclosed
in accordance with applicable regulations and prevailing industry practices.
■ Falsification of records or misrepresentation of conditions or practices in the supply
chain of business partners is unacceptable.

(4) Intellectual Property■ The need to protect intellectual property rights must be respected and given due
consideration. Transfer of technologies and expertise must be implemented in a mannerthat does not infringe on intellectual property rights, and customer information is to besafeguarded.

(5) Fair Business, Advertising, and Competition■ Standards of fair business, advertising, and competition are to be upheld. In addition,
appropriate measures are to be implemented to safeguard customer information.

(6) Protection of Identity and Non-Retaliation■ Programs to protect the confidentiality of whistleblowers and allow them to whistleblow
anonymously are to be formulated, unless prohibited by law. Business partners should havea communicated process for their employees to be able to raise any concerns and humanrights issues without fear of retaliation.

(7) Responsible Sourcing of Minerals■ Business partners shall have a policy to reasonably assure that the tantalum, tin, tungsten,and gold in the products they manufacture are sourced in a way consistent with the OECD
Guidance (Organisation for Economic Co-operation and Development Due Diligence
Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk
Areas) or an equivalent and recognized due diligence framework. Business partners shallalso conduct due diligence on cobalt and mica based on EMRT (Extended Minerals
Reporting Template).

(8) Privacy■ Business partners are to commit to protecting personal information of everyone they dobusiness with, including suppliers, customers, consumers, and employees.

14■ Business partners are to comply with privacy and information security laws andregulatory requirements when personal information is collected, stored, processed,transmitted, and shared.

(9) Prohibition of Abusing Advantageous Position■ Business partners shall conduct good faith, fair, and impartial trading pursuant to contracts
and arrangements. It is not allowed that suppliers make a unilateral decision orchange trade terms with their suppliers or impose unreasonable requests or obligations
making use of the advantageous position of transactions.
■ Business partners shall comply with laws and regulations concerning the abuse ofadvantageous position in any country where such laws and regulations are established.

5. PRODUCT SAFETY(1) Ensuring Product Safety■ When designing products under their own responsibility, business partners must employ
designs capable of securing product safety through compliance with applicable laws andregulations, conformity to standards, and design of products reflecting consideration forsafety.

■ Securing product safety should include the management of traceability (e.g., history ofmaterials, parts, process) and prompts responses for problem solving.

(2) Provision of appropriate product-related information■ Business partners must appropriately show necessary information, including specification,
quality, handling procedures of products or services.

6. MANAGEMENT SYSTEMS(1) Company initiatives■ Business partners shall formulate policies approved by top management to fulfill theircorporate social responsibility through confirmation of compliance and efforts toward
continual improvement and policies related to their responsibility to protect the environment.

(2) Management accountability and responsibility

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■ Executives in charge of ensuring that the management structure and related programs are
implemented shall be made clear.
■ Executives in charge shall review the management structure periodically.

(3) Legal requirements and customer requirements■ Processes shall be established to identify, monitor, and understand applicable laws andregulations and customer requirements.

(4) Risk Assessment and Risk Management■ Business partners shall establish a process to identify the legal compliance, environmental,
health and safety, labor practice and ethics risks associated with operations.
■ To ensure regulatory compliance, the relative importance of individual risks shall be
evaluated and they shall be managed based on appropriate procedures.

(5) Improvement Objectives■ Objectives and implementation plans are to be established to improve the Business Partner’s
fulfillment of its social and environmental responsibilities.

(6) Training■ Programs are to be conducted for training managers and workers to implement the Business
Partner’s policies, procedures, and improvement objectives.

(7) Communication■ A process for communicating clear and accurate information about business partners’
policies, practices, expectations, and performance to workers, suppliers, and IDEC group is
to be established.

(8) Worker Feedback and Participation■ Ongoing processes to assess employees’ understanding of and obtain feedback on practices
and conditions covered by these guidelines and to foster continuous improvement are to be
maintained.

(9) Audits and Assessments■ Business partners shall conduct periodic self-evaluations to ensure conformity to legal andregulatory requirements related to social and environmental responsibility, the requirementsof these guidelines, and customer contractual requirements.

16(10) Corrective Action Process■ A process for timely correction of deficiencies identified by internal or external assessments,
inspections, investigations, and reviews is to be maintained.

(11) Preventive measures■ A process is to be maintained for measures to prevent the reoccurrence of deficiencies thathave occurred and the occurrence of similar deficiencies.

(12) Documentation and Records■ Documents and records to ensure regulatory compliance and conformity to practices andconditions covered by these guidelines along with appropriate confidentiality to protect
privacy are to be created and maintained.

(13) Supplier Responsibility■ A process to communicate these guidelines requirements to suppliers and to monitor suppliercompliance to these guidelines is to be maintained.

(14) BCP Initiatives■ In order to prepare for natural disasters, accidents, and contingency situations, business
partners shall formulate Business Continuity Plans to implement measures to ensure stablesupplies of materials and services within a scope that includes the IDEC Group andsuppliers’ own suppliers and to support IDEC Group risk management initiatives.

7. External reporting desk
The IDEC Group has established a "Corporate Ethics Consultation/Whistleblowing Desk (IDEC
Hotline)" to receive consultations and reports regarding violations of laws and regulations,misconduct, acts contrary to corporate ethics, workplace conditions, etc., and strives to preventand detect problems in advance.
As part of this effort, we will open the "IDEC Group Partner Hotline", a compliance reporting desk,
to receive reports from suppliers.
If you find that an IDEC Group officer or employee engages in, or is suspected of, violating thelaw, violating corporate ethics, or deviating from a contract or transaction terms when conducting

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business with you, or if you have any concern regarding human rights related to the business,please report it to this hotline.
Please make sure not to use this Hotline for any other purpose than those mentioned above (e.g.,
to make dishonest profits or to defame individuals and the like).
・ IDEC Group Partner Hotline
URL：https://i365.helpline.jp/idec_hotline/partner?lang=en
The ID and password required to use this reporting desk will be provided separately.

References
These Guidelines summarize practical standards for actions and activities to be implemented andcomplied with by suppliers, based on the IDEC Group Corporate Ethics and Code of Conduct.
The following standards were referred to in its preparation.
・ IDEC Group Corporate Ethics and Code of Conduct
https://us.idec.com/idec-us/en/USD/csr/governance/conduct.html

・The Ten Principles of the United Nations Global Compact
https://unglobalcompact.org/what-is-gc/mission/principles
・ILO International Labor Standards
www.ilo.org/public/english/standards/norm/whatare/fundam/index.htm
・Responsible Business Alliance Code of Conduct
http://www.responsiblebusiness.org/standards/code-of-conduct/

Document revision history
First edition: August 1, 2018
Second edition: November 20, 2023

1. Information provided by suppliers may not be disclosed externally.
2. The content of these Guidelines is subject to change in response to revisions to laws,
regulations, internal rules, or other materials. Check the IDEC website regularly for the latest
information.
3. If you have any questions about this guideline, please contact the address below;
Purchasing Department

Tel.: +81-6-7668-7580

Sustainability Management Department

Tel.: +81-6-6398-2581

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