Report on the Ways to Take the Opportunity of "Business and Human Rights"
Requirements in Contemporary Sustainable Society
CSR Committee, Business Policy Forum, Japan
March 2022

Executive Summary<Index>Introduction
Chapter 1: General Trends of Business and Human Rights (BHR)(1) "Guiding Principles on Business and Human Rights" of the United Nations(the UNGPs)(2) General Trends of BHR
Chapter 2: Current Situation of Legal Regulations and Court Cases, Rule
Making Processes and Behaviors of Institutional Investors
Regarding Business and Human Rights (BHR) Issues(1) Current Situation of Legal Regulations and Court Cases(2) Current Situation of Processes to Establish Legal Regulation in EU(3) Current Situation of Behaviors of Institutional Investors
Chapter 3: Current Situation of Corporate Actions for Business and Human
Rights (BHR) Issues(1) Current Situation of Actions of Japanese Corporations for BHR Issues(2) Corporate Actions from Interviews and Open Articles for BHR Issues
Chapter 4: Evaluation and Suggestion to Upgrade Related Actions for Businessand Human Rights (BHR) of Japanese Companies(1) Framework in Evaluating the Level of "Maturity" on Related Actions for
BHR(2) Suggestions
Member of CSR committee of Business Policy Forum, Japani

Introduction✓

10 Years since Guiding Principles:➢

10 years have passed since the "Guiding Principles on Business and Human
Rights (the UNGPs)" were endorsed at the Human Rights Council (HRC) of
the United Nations in 2011 to present the framework of challenges forgovernments and companies.

Since then, the UNGPs have become

widespread as the international standard.

Many governments haveestablished National Action Plans (NAP) and introduced legal regulations. A
large number of global companies have established their own human rights
policies and innovated their due diligence processes.
➢

In these circumstances, practical topics, such as appropriate ways to performthe UNGPs, or to clear the discrepancies between the policies and the real
implementation by both governments and companies, have become thesubject of wide attention.

✓

Overall Trends of Business and Human Rights (BHR):➢

Social circumstances concerning Business and Human Rights (BHR) havenow been elevated to a more serious situation. The kind of negative impacts
from worsening environmental issues including climate change, or from newtechnologies like artificial intelligence are now broadly acknowledged.
Furthermore, a conflicting social structure was revealed in the period of
reduced stability by dictatorial and violent politics, a populism type movement,
and expanded disparity in wealth, concurrently with the outbreak of the
COVID-19 pandemic, where human rights of those vulnerable were not fully
respected.

➢

In this period of time, the Japanese government launched its "National Action
Plan on Business and Human Rights (2020-2025)" and revised the "Corporate
Governance Code" to specify the responsibility of the board of directors to
respect human rights.

In addition, the introduction of guidelines of due

diligence for human rights is now under discussion.
✓

Background and Targets of this Report:➢

The main objective of this report is to summarize major challenges andmeasures of companies through research on on-going actions of progressive
corporations in order to suggest all companies to upgrade and advance theactions regarding BHR.
ii

➢This report is intended to be read by top managers, board members andleaders related to BHR issues of all companies, and it can be referred to bycompanies of all fields and all scales in Japan.

Chapter 1: General Trends of Business and Human Rights (BHR)(1) "Guiding Principles on Business and Human Rights" of the United Nations(the UNGPs)➢

The UNGPs were established to control the governance gaps, or difference incapacity, among societies to properly manage the adverse consequences ofhuman rights brought by multi-national corporations that grew in the
globalized economy.

➢

The UNGPs are composed of 3 pillars, which are, (a) the state duty to protect
human rights, (b) the corporate responsibility to respect human rights, and(c) access to remedies. The most important indication of the UNGPs is thatgovernment and corporations have different but complementary roles insettling human rights infringements.

This concept provides a common

global framework for various stakeholders to work together for BHR.
➢

In this framework, companies are asked to establish and pledge to abide by
their own policies to respect human rights, and to move to practice the due
diligence programs in which they identify, evaluate, prevent and reduce andaccount for adverse human rights impacts.

➢

The phases of human right impacts caused by companies are classified into
three stages. These are, (a) to cause adverse impacts, (b) to contribute toadverse effects through its own activities, or (c) the situation that theiroperations, products or services are directly linked to the adverse effects
through their business relationships.

Adverse impacts should be addressed

depending on the actual stage of the situation.
➢

Proper grievance mechanisms should be established to have appropriate
measures according to the states, companies and society as a whole so those
who were adversely impacted can be protected appropriately.

(2) General Trends of BHR✓

Enlarged Scope of Business and Human Rights Issues:iii➢The scope of human rights now is no longer limited to traditional humanrights such as harassment, discrimination and forced or child labor, but has
expanded to include human rights issues caused by new technologies likeartificial intelligence (AI), and environment issues including climate change.

✓

Expanded Disparity Brought during the COVID-19 Pandemic:➢

The COVID-19 pandemic has brought intense impacts on those vulnerable,
especially females, children, disabled and the poor.

This situation is now

influencing companies and investors to accept the perception that dealing
with human rights and social justice will lead to constructing a more resilient
society, together with the spread of the "Black Lives Matter" movement that
occurred in the USA during the same period.
✓

Development of New Technology and Human Rights:➢

The way to construct appropriate regulations for new technologies is underintense discussion since both development and introduction in the society of
new technologies including AI has progressed thus far. One of the major
topics of discussion is the accountability-gap, or lack of sufficient explanations.

➢Companies are urged to be accountable for their own actions while being
sensitive to the potential infringement of human rights when using AI
technology, and furthermore, are advised to take part in rule-making
processes from either the supply side or demand side of new technologies.

✓

Geopolitical Risk and Human Rights:➢

In recent years, higher risk cases have been observed when the action of astate to contribute to adverse human rights impacts does induce creation ofreal adverse human right impacts by a closely related company.

➢

In order to prevent and mitigate adverse human right impacts, companies
should enhance their due diligence programs and take appropriate action to
mitigate detected effects. In a case where a company is not able to preventor mitigate adverse impacts sufficiently, ending the operation, temporarily or
permanently, taking account of credible assessments of the potential impactsof doing so, is an important option to have.

➢

In addition, it is important for companies to develop joint works with othercompanies, or to engage in discussions and collective actions withstakeholders, such as NGOs, states and others, as well as to disclose theirprocesses and outcomes in a transparent manner.
iv

Internal decisions of acompany for those actions that should affect its business results greatly
should directly be made by the top executives, which must be extremely
difficult for only the directors in charge.

Chapter 2: Current Situation of Legal Regulations and Court Cases, Rule
Making Processes and Behaviors of Institutional Investors Regarding Businessand Human Rights (BHR) Issues(1) Current Situation of Legal Regulations and Court Cases✓

Effects on Japanese Businesses of Legal Regulations or Soft Laws ofForeign States Regarding Human Rights➢

Applying domestic rules to business activities performed outside of thejurisdiction are challenged by some foreign states through various methods,
including extraterritorial application of domestic regulations, rules to requirecompanies to oversee activities of customers in the supply and related chains,
economic sanction and trade restrictions, or conditioned deregulation. Thissituation has started to have real effects on Japanese companies.

➢

In addition, de facto rules are set up by various stakeholders beyond state
regulations.

These actual rules may also have a potential influence on

business activities, together with state regulations.
✓

Situation of Court Cases and Judgements or Non-Judicial Remedies
Regarding Human Rights➢

Traditionally, the judicial system did not allow for dealing with issues that
occurred outside of its legal jurisdiction.

However, recently some court

decisions of several states ruled that a parent corporation based in the
country of the court had responsibility to ensure its affiliated companies do
not cause adverse human right effects, even though those adverse effects
occurred in other countries.
➢

There is another current tendency regarding the standard of non-judicial
remedies, in which whether sufficient human rights due diligence is carriedout or not plays a major role in evaluating the responsibility of a parent
corporation, concerning adverse human right effects caused by subsidiarycorporations or related companies in the supply chains in foreign countries.
v

(2) Current Situation of Processes to Establish Legal Regulation in EU➢

In February of 2022, a proposal for an EU Directive on "Corporate
Sustainability Due Diligence" was made public. The proposal prescribes that
all corporations over a certain magnitude are required to perform due
diligence regarding themselves, affiliated companies and other companies
they have strong business relations with. This rule may require Japanesebusinesses, if enacted, to take corresponding actions through the lines ofsupply chains or value chains.

➢

Regarding EU rules for sustainable finance, the "Sustainable Finance
Disclosure

Regulation(SFDR),"

which

stipulates

theframeworkoninformation disclosure to end-investors by asset management firms andinstitutional investors, became effective in February of 2022, and the detailed
enforcement regulations will be put into operation in the near future. The
regulation will ask financial investors to disclose activities for human rights
protection performed by companies they invested in.
➢

Another related regulation in EU is the "Corporate Sustainability Reporting
Directive (CSRD)," which requires non-financial companies to disclose theirinformation on sustainability, and is scheduled to be put into enforcement in
2023.

(3) Current Situation of Behaviors of Institutional Investors➢

An international group of institutional investors, "Principles for Responsible
Investment (PRI)," which has more than 3800 signatories, has chosen
climate change and human rights as its focus themes of the annual meetings
for the past 5 years consecutively.

➢

Other benchmark frameworks are also established through joint works with
NGOs, such as "Know the Chain," that evaluate corporate activities to deal
with the potential risk of forced labor, or the "Corporate Human Rights
Benchmark (CHRB)," that assesses total activities for human rights of acompany with a specific focus on industry sectors that have higher risks inhuman right infringement. Some institutional investors overseas have cometo utilize these benchmarks as a standard in executing voting rights.

➢

Foreign investors, in general, tend to place higher emphasis on social matters
than Japanese investors.

Research by Japan's Government Pension

Investment Fund (GPIF) on materiality among its entrusted institutions saysthat passive-style investors, both domestic and foreign, values theviimportance of climate change, diversity and the supply-chain the highest. It
showed, at the same time, that domestic active-style investors place theirmain priority on governance issues, but foreign investors of this style set their
top priority on the climate change issue, followed by health and safety, humanrights and local community issues.

Chapter 3: Current Situation of Corporate Actions for Business and Human
Rights (BHR) Issues(1) Current Situation of Actions of Japanese Corporations for BHR Issues
The result of joint research carried out by the Ministry of Economy, Trade andIndustry and Ministry of Foreign Affairs was made public in November of 2021 thatsurveyed listed enterprises in the 1st and 2nd section of the Tokyo Stock Exchange
and similar scale companies (total number of respondents: 760).

The CSR

Committee had previously carried out similar research in 2018 for almost the same
magnitude of enterprises (total number of respondents: 373). The current situationof the activities for BHR of Japanese corporations is evaluated as follows, from thecomparison of the research.
✓

Level of Familiarity for Human Rights Issues➢

The levels of familiarity on both UNGPs and Due Diligence for Human Rights
showed an increase from the 2018 research result.

This suggests that

corporate recognition for human rights issues has advanced steadily in the
period of extended concern for BHR.
✓

Establishing Own Policies for Human Rights➢

The numbers of corporations that established their own policies for humanrights has increased in the past 3 years. The 2018 research showed that alarge number of corporations had revised their own policies during thepreceding 2 years to place more emphasis on human rights reflecting the
expansion of ESG investments. This move is thought to be continuing.

✓

Implementing Due Diligence Processes➢

The number of respondents for the government research in 2021 was muchlarger than that of the 2018 research.
vii

Considering that the level of actualprocesses of due diligence varies depending on the corporation, further
detailed research is expected concerning the real steps to evaluate adverse
effects, actual methods to prevent or mitigate adverse effects, to follow-up
on the found cases, and to disclose related information.
➢

Corporations which had not taken steps of due diligence in the research
replied stating that they were lacking sufficient knowledge, experienced staff
or funds to deal with it.

✓

Organizing Grievance mechanism➢

Half of the respondents for the 2021 research answered that they havelaunched their own guidelines or procedures to protect sufferers and address
business-related human rights infringement, whereas only 30% of the
respondents for the 2018 research stated that their remedy processes
covered their suppliers that were considered to have higher risks on humanright issues. More detailed studies on the targets of complaint or grievancesystems and on the results of implementation would be appreciated in future
research.

✓

Disclosure of Information➢

The 2021 research showed that more than half of the respondents said they
disclosed related information, but detailed contents of the answers were notmade public.

The 2018 research result showed that under 10% of thecorporations disclosed their distinct human right topics or performances
based on Key Performance indicators.
✓

Proposals from Corporations in the 2021 Research➢

The group of corporations that engaged in human right tasks in a positive
manner raised proposals in the 2021 research about international unificationof related regulations and institutions, further support for acquiring
information on overseas systems, and building up more familiarity among
domestic society and companies.

Among other groups of corporations

which had not promoted related programs that much, almost half of themstated that they have little information on how to deal with the issues, andmany of them expected to be provided with more information regarding
actual cases of due diligence activities of other corporations.

viii

(2) Corporate Actions from Interviews and Open Articles for BHR Issues
The CSR committee interviewed 10 Japanese corporations in 2021 together with
5 foreign corporations through open articles.
A) Establishing and Committing to Own Policies (related to UNGPs #16)➢

Typical practices of each interviewee corporation were to establish and makeits own policies on human rights public based on the core requirements of
UNGPs after sufficient discussion among top management, related divisions
and outside experts.

➢

Some examples of the actions were as follows;⚫

to update their own policies considering both the situations of extendedsocial perception on BHR and the stage of progress of their internal
programs,⚫

to re-organize the policies to integrate them with total and multifaceted
corporate visions, or to explain the relation between corporate visions or
purposes and human rights values,➢⚫

to put together new programs to deal with specific tasks, or⚫

to publish a message when a new socially distinctive event occurs.

It is their own policies for human rights that work as practical criteria todecide appropriate responses when a risk event happens.

Policies ofsuperficial words are not useful for real actions and they are not effective forpromoting internal shared understanding. Periodical improvement of theirown policies for operating procedures and reinforcing a team structure ishighly advised for assuming fair responsibility to prevent and mitigate humanrights infringement.
B) Organizing Internal Structure and Education (related to UNGPs #16)➢

Each interviewee corporation designated a board member and a division in
charge during the process of establishing its own policies, and organized its
internal structure regarding both the regular processes of the whole company
and on specific actions for each risk event. In many cases the division of
CSR or Sustainability was in charge of the management of the total internal
processes in cooperation with related divisions.

➢

Major responses in the interviews underlined the importance of facilitating
further understanding of human rights and encouraging employees toconsider the corporate risks from BHR as their own tasks, when they would
share and disseminate their own policies among the whole corporation. Oneix

company stated that its experience in another country coping with moreadvanced

local

regulations

accelerated momentum

topromotethisthroughout the whole company.
➢

These answers suggest the important values in re-organizing internal
processes to be more effective in minimizing human right risks.

Thefollowing steps should be vital in tackling those challenges;⚫

to coordinate general processes of the whole company and case-by-casereactions for specific events,⚫

to share related tasks between the headquarters and its branches abroadwith appropriate coordination,⚫

to set up a roadmap or indexes to track performances of the procedures
periodically, and⚫

to review and re-organize, if needed, related processes or institutions
based on the possible transition of social circumstances.

C) Collecting Information and Assessing Adverse Human Right Effects(related to UNGPs #18)➢

When evaluating adverse human right effects, it is important to look widelyover the whole business value chain without prejudice for the kind of possible
risks, and to start tackling issues one by one based on priorities from risk
levels examined according to the characteristics of the business style andsectors.

➢

Many interviewee corporations set their priorities in the area of supply-chains,
and thus, made a questionnaire survey in the form of the self-assessed
questionnaire (SAQ) method over their direct suppliers, and made periodical
inspections including site visits to the operations of the areas or suppliers thatwere found to have higher risks in human rights. In a case where a company
deals with diverse and varied goods and services, the company made several
limited extraction surveys over its direct suppliers, considering that setting apriority on higher risk factors was not practical.

➢

Concerning indirect suppliers, some companies whose risk factors were
specified, implemented intensive surveys over their specific indirect suppliersof the risk area. At the same time, most of the interviewee corporations had
not started their surveys with indirect suppliers.

➢

Regarding the downstream-side of the value-chain, or customers, it seems
that most companies had not started sufficient actions.

➢

For how to gather necessary information to select risk sectors or areas, thexfollowing methods were mentioned by many corporations;⚫

implementing employee interviews and questionnaire surveys in thecompany,⚫

collecting information of general research or other companies,⚫

engaging in discussions with stakeholders, or⚫

utilizing an outside database to get objective criteria to select target
sectors and areas.

➢

These results show the need for Japanese corporations to arrange anddisclose the situation of the business operations in the whole supply chain
step by step, starting from direct suppliers and widening it to suppliers ofdifferent stages. It is also recommended to develop grievance mechanisms
to be used by any party concerned in the supply chains, especially with raw
material sources.

D) Preventing and Mitigating Adverse Impacts and Tracking the Effectivenessof Remedies (related to UNGPs #19 & 20)➢

All of the interviewee companies introduced some measures to prevent andmitigate possible adverse effects.

Many of them said they asked their

suppliers and customers to improve the situation, and that they made it arule to monitor the actions taken afterwards when they found something thatneeded to be improved in a survey carried out by SAQ or others.
➢

The approaches to improve and reform the situation are different dependingon the kind of detected risks of BHR.

An example of measures to deal withrisks concerning raw materials in the manufacturing sector were to cooperatewith NGOs especially in understanding and disclosing the situation of supply
chains, and in settling problems of local society related to production
processes in factories.

Another example of solutions regarding theemployment conditions for foreign workers and technical trainees, which isrecognized as one of Japan's risks, was to grasp the situation by conducting
interviews with the persons concerned and devising appropriate measures toimprove the situation.
➢

In general, major corporations are expected to influence their customers andsuppliers properly to prevent and mitigate the adverse effects that might
happen during a series of operations. In the last few years, the scope of the
expectation among societies has expanded to the suppliers of primary raw
materials. Many of the problems are rooted in the social structure and it is
not easy for a single corporation to settle the issues. This is why collectivexi

actions are in definite need in order to solve the structural problems.

E) Disclosure of Related Information (related to UNGPs #21)➢

Most of the interviewee companies disclosed their procedures and systems
regarding their own policies, internal operation systems, processes of due
diligence for human rights, typical examples of employee education andarrangements of grievance services, while only a small number made theirdetailed results public on how these measures actually worked.

➢

Several Japanese corporations have now made their special report solely onhuman right issues public.

Some of the interviewee companies also

disclosed detailed information on supplier lists or supply-chain trees, resultsof their surveys for direct suppliers, and outcomes and reactions in theirgrievance mechanism.

Many stated that they elaborately responded toinquiries from NGOs, with additional surveys about the real situation, if
necessary, and that they share the results among related divisions for the
next surveys.
➢

It is recommended for the sake of providing effective information to
institutional investors that corporations disclose their results of the PDCA
management operations, especially about the scope, methods, findings,
reactions and implications for future operations regarding their due diligenceprograms, in addition to information of the regular check-box format for ESG
index evaluation.

F) Establishing Grievance Mechanisms (related to UNGPs #22, 29-31)➢

All interviewee companies set up a contact center for their own employees,
however the percentage of interviewees which have established contact
centers for all the employees of their affiliated group companies both in Japanand abroad is limited. Examples of the cases include cases in which a lot ofwork had taken place to disseminate the information of the contact center
among their employees, and that a new PC application that can be operated
in multiple languages was introduced for foreign workers.

➢

Some companies stated that they set up contact centers for specific lines ofsupply-chains. The grievance mechanism framework of collective actions
among NGOs, business associations and governments is now underconsideration and preparation in Japan as well as in other countries,
considering that it has a lot of merits in cost, management load, efficiency
xii

and accessibility for users.
➢

The critical objectives of the grievance mechanism are, first of all, to monitor
and analyze the general patterns of grievance contacts, and secondly, toidentify the basic causes of possible adverse human right effects, and toprevent and mitigate them in early stages. These steps are, in other words,
running a PDCA cycle. It is highly advised that the mechanism be improved
so that a wider range of potential users can be reached more easily andsmoothly.

Chapter 4: Evaluation and Suggestion to Update Related Actions for Businessand Human Rights (BHR) of Japanese Companies(1) Framework in Evaluating the Level of "Maturity" on Related Actions for
BHR✓

The possibility for companies to cause adverse effects cannot be fully eliminated,but the potential risk and the degree of severity would be reduced throughdeveloping maturity of their related actions.

The development might also

provide clues to find brand new approaches for value creation in the businesses.
✓

The practical approaches are not uniform in general, however. A single concrete
picture of necessary and sufficient actions cannot be provided easily.

Someessential ways to develop their actions are to evaluate their own potential risks
regarding human rights according to their business field, scale and style, and to
take actions starting from issues of higher priority.

It is also critical to holdengagements and discussions with stakeholders to monitor the needs of parties
concerned and society, as well as to check outcomes of their actions.
✓

The framework of the following three levels of maturities for related approaches
are proposed to serve companies to evaluate their own position andperformances and to deliberate further projects for BHR issues.

[TABLE]

xiiiA) Level 1➢This is the level that is required for all companies to proceed with in a shortperiod of time, including small and medium sized enterprises.

Concreterequirements are, first of all, local legal regulations, while other rules may beentailed on through actual demand from business partners, even if they do
not operate directly in foreign areas. When a company has transactions witha global corporation that is covered by the scope of related EU regulations,the company is asked to follow the regulations with a higher sense of urgency
and at the corresponding level.
➢

The major goal is to organize an internal institution to continuously checktheir actions with PDCA processes, through understanding the contents of
BHR issues that are required under international standards, and establishing
their own human right policies, managing due diligence procedures, andimproving the grievance mechanism based on UNGPs.

➢

The first essential step of all the effective actions is for the top management
to comprehend the significance of BHR issues.

B) Level 2➢This is the level listed corporations in Japan are expected to reach
immediately. The actual contents of this level are to sufficiently prepare forthe new rules, promoted mainly in EU, and to develop the procedures andtheir own related institutions further to prepare for specific risks of theindustry sector or of its business model.

➢

The major goal is to continue and upgrade actions for BHR issues, and tointegrate them into management and business operations. Keeping track of
cyclical check processes of due diligence may make it possible to generate ahigher reputation from customers or increased job motivation among
employees.

➢

The most important task of a corporation in promoting actions of this level isto adopt its own policies as the global standard of the whole company, andto organize an internal system to implement the policies in order to cope withthe difference between the international standards and local rules.

C) Level 3➢This is the level that a global corporation that leads and influences the world
market is expected to reach. Progressive global corporations in the U.S. andEurope are working with strategic minds to create innovative markets fromxivthe viewpoint of human rights, and to formulate updated business rules or
new frameworks to lead to innovative values.

Japanese corporations ofsimilar business fields are also expected to perform at this level.
➢

It should be noted that at this level the area a single corporation can manage
by itself decreases comparatively because the remaining human right risks
depend largely on structural factors, and that collective actions organized bycooperative works with multi-stakeholders have greater potential.

➢

The major goal is to construct a framework to grasp impacts for BHR by
maintaining total due diligence programs that cover direct suppliers, in-direct
suppliers and all the suppliers up to the raw materials in the supply chains,
by establishing a grievance mechanism in collective ways, and by holding
engagements with rights holders.

➢This approach needs a series of trials of collective challenges with the industry
sector or with other stakeholders in the viewpoint of long-term corporate
management.

(2) Suggestions✓

The move of making rules in leading regions has had a steady impact on
Japanese corporations through global supply chains, which seems to have urged
movement to study new rules in Japan.

A substantial decrease of human rightrisks in a supply chain should be accompanied by the situation in which thedecrease is achieved in all businesses in the supply chain.
✓In particular, corporations that operate their businesses globally are advised towatch and follow the steady and enhanced world trends, initiated mainly inEurope, that place a lot of value on BHR issues.

It may take a considerable

amount of time to cope and to be skilled with new legal regulations andinternational standards.

This is why companies are asked to proceed with theirstudies and corresponding actions as soon as possible.

A) Suggestions to All Companies:➢

Starting from the conviction of the top management to regard BHR issues
as the primary task in operating businesses, all companies are asked toinitiate and promote related actions for BHR, through establishingpractical policies according to their maturity levels, and implementing
PDCA processes in cooperation with other Japanese businesses andxvsociety.
✓Due diligence programs for human rights should be integrated into business
operations as a routine rule, which may not be accomplished in a short time.
Any company that has a business within any supply chain system is asked
to promote BHR processes, regardless of its company size.

✓

Top management is strongly asked to regard BHR issues as the primary task
in operating businesses. All Japanese companies are advised to start theiractions for BHR, and upgrade the level of maturity in cooperation with otherJapanese companies and society.

B) Suggestions to Corporations that Operate Globally:➢

Corporations that operate their businesses globally, as well as companies
that have transactions with global supply chains or investment chains,are asked to integrate their actions for BHR into their businesses andmanagement operations as soon as possible, through upgrading thematurity level by accelerating their programs.
✓

Some corporations are now requested to perform specific actions with global
companies or institutional investors that are directly covered by the scopeof regulations for BHR. They are, first of all, strongly expected to arrange
and maintain the level 1 actions immediately, and secondly, to upgrade theirprograms to higher level 2.

✓

In some cases, urgent decisions are actually required regarding due
diligence processes. In other cases, critical and urgent decisions by the
management board became necessary to suspend or to withdraw from
specific businesses.

It is, therefore, reasonable to arrange internalarrangements beforehand to prepare for that kind of risk incident to not beleft behind in the future.
C) Suggestions to Large Corporations that Lead the Global Market:➢

Large corporations that lead the global market are expected to constructimpacts to resolve structural conflicts.
✓

Large corporations that lead the global market are expected to constructimpacts for society through relevant contributions to resolve complicatedconflicts. This can be performed, at first, by decreasing human right risks
in their own operations in the supply chains, and by, in higher steps,
challenging structural conflicts in a positive manner to develop businessvalues through transforming business playing fields strategically.
xvi✓It is essential in the latter processes to work jointly with outside
stakeholders including NGOs, governments and business associations.
Large corporations are expected, in particular, to play a major role inpromoting collective actions for preventing and mitigating adverse effects inthe supply chains, or for constructing group grievance mechanisms.

D) Suggestions to Business Associations:➢

Business associations are expected to promote establishing standards ofrelated corporate activities, and to lead to resolve structural conflicts.
✓

Business associations are expected to handle the following;⚫

to promote establishing standards in each business sector.

⚫

to develop specific remedy methods based on particular risks orcircumstances in the sector, or to disseminate them.

⚫

to enhance collective actions to deal with specific structural conflicts.

⚫

to arrange group grievance mechanisms in the sector.

E) Suggestions to the Japanese Government:➢

The Japanese government is expected to improve institutional frameworkas the main coordinator, and to encourage Japanese companies

toupgrade their action levels.
✓

The Japanese government is expected to make steady progress on the
programs shown in the released "National Action Plan," as well as toenhance each program much further.

✓

The following points are especially welcomed among Japanese companies;⚫

to arrange international rules to respect human rights including
adjustment among each national or regional standard and providing
support for adapting to foreign regulations, or to reinforce andrationalize domestic rules and regulations set by the government.

⚫

to construct related infrastructure and promote programs to help
expand effective and efficient actions for BHR by companies.

⚫

to advocate understanding and interests among Japanese society,including more measures to disseminate positive perception andinterests.

xviiMember of CSR committee of Business Policy Forum, Japan（the chair）
Tetsuyuki Kagaya
Professor, Graduate School of Business Administration, Hitotsubashi University（the committee）
Youzou Nakao
Sustainability Group, Sustainability Development Department, Global Corporate
Division, Ajinomoto Co., Inc.
Chikako Miyata
Senior Vice President, Legal & Insurance, General Administration, Corporate
Sustainability and Director of Corporate Sustainability, ANA HOLDINGS, INC.
Akihiro Inatsugi
Director, Corporate, Sustainability Division, Bridgestone Corporation
Nobuhide Aoyama
Senior Director, Sustainability Unit, FUJITSU LIMITED
Haruo Hatanaka
ESG Strategy, ESG Division, Kao Corporation
Tomoko Hasegawa
Managing Director, Keidanern (Japan Business Federation)
Yohko Sekizaki
General Manager, Sustainability Department, MARUI GROUP CO. ,LTD.
Hiroki ShinnoManager, CSR Section, CSR &Citizenship Office, Corporate Strategy and Technology
Sector, Panasonic Corporation
Kei KanaiManager, Sustainability Department, Sompo Japan Insurance Inc.

xviii

Mitsu Shippee
Senior General Manager, Sustainability Department, Sony Group Corporation
Shigeki Matsui
General Manager, CSR Operation Dept., Toray industries, Inc.
（Observer）
Shozo Maeda
Director for Industrial Policy, Ministry of Economy, Trade and Industry
Miki Nogami
Assistant Director, Corporate Accounting, Disclosure and CSR Policy Office, Ministryof Economy, Trade and Industry
Hidemi Tomita
Managing Director, Lloyd Register Japan kk（Secretariat）
Kenyu Adachi
Chairman of the boad of Directors, Business Policy Forum, Japan
Tetsu Fukuoka
Director general, Business Policy Forum, Japan
Akira Kitabatake
General manager, Planning & research div., Business Policy Forum, Japan
Hiroaki Konishi
Senior researcher, Planning & research div., Business Policy Forum, Japan
Takeshi Nozawa
Researcher, Lloyd’s Register Japan KK
Nao Okayama
Researcher, Lloyd’s Register Japan KK/END/xix