"Engagement" and "Remedy" Guidelines
for Promotion of Responsible Business Conductand Responsible Supply Chains (1st Edition)

Overview
December, 2019Japan Responsible Supply Chains Committee

1Overview ofEngagement and Remedy Guideline Project＜Implementation Body＞
Japan Responsible Supply Chains Committee

The committee is comprised of multi-stakeholder members
including individuals engaged in business, investment, civil society,law, international organizations, and public organizations.

＜Leading Organizations＞• Global Compact Network Japan (GCNJ)• Business and Human Rights Lawyers Network Japan Buisness(BHR Lawyers)＜Supporting and Advising Organizations＞• Civil Society Platform for Japan’s National Action
Plan on Business and Human Rights (BHR-NAPInvestors
CSPF）• OECD Centre for Responsible Business Conduct• ILO Office for Japan＜Accreditation＞
The Project is accredited as “Tokyo 2020 Support Program(Sustainability)” by Tokyo Organising Committee of theOlympic and Paralympic Games

PublicInstitutions

Civil SocietyExperts

Lawyers2

Purposes and Backgroundof the Formulation of the Guidelines＜Purposes＞

The Guidelines aim to:• Promote constructive dialogues
between business and society;• Strengthen grievance mechanisms;• Ensure access to remedies
in the Japanese Business contexts.

＜Backgrounds＞
The Guidelines contribute to:• Development of the legacy of Tokyo2020• Enrichment of Japan's National Action
Plan on Business and Human Rights• Dissemination of the ESG initiatives byJapanese companies

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Structure of the Guidelines
See Page 5 & 6.

Implementation

See Page 7.

（Guidance on Collective GrievanceMechanisms）

See Page 8.

The Guidelines are comprised of four documents:• (0)Introductory Document• (1) Engagement and Remedy Guidelines (Text)• (2) Grievance Centers Guidelines• (3) Basic Action for Engagement and RemedyGuidelines4

(1) Engagement and Remedy Guidelines (Text)
Chapter 2 describes the governance and procedures ofgrievance mechanism in individual companies.

5(1) Engagement and Remedy Guidelines (Text)
Chapter 3 shows a model grievance mechanism clause in supply chain
agreements as well as key perspectives in handling complaints in supply chains.
(Clause for Grievance Mechanism)
1. Purpose of this Clause
Buyer and Supplier agree to this clause in the interest of promoting constructive dialogue with stakeholders through the supply chain
and working together to ensure access to human rights remedies.
2. Implementation and Cooperation of Complaint Processing
Supplier will properly handle stakeholder complaints regarding sustainability issues, such as negative impacts on human rights in its
own business and supply chains (the "Complaints") and will cooperate with Buyer in handling the Complaints.
The content of Supplier’s collaboration with Buyer in handling the Complaints shall include the following:(1) Implement measures to facilitate stakeholder accessibility, such as cooperating with the Buyer to disseminate the complainthandling system to be developed or used, at the request of the Buyer.
(2) Not to treat the complainant (including organizations or individuals who duly support or represent the complainant) in a
disadvantageous manner, such as retaliation, on the grounds that the complainant has filed a complaint against the Buyer, or tohave a third party to do so;(3) In order to cooperate with the Buyer in investigating the facts of the Complaints, the Buyer shall be provided with the required
information and the Buyer shall be inspected and audited at the request of the Buyer.
(4) Determine appropriate grievance mechanisms measures with respect to the Complaints at the request of the Buyer.
(5) Report to the Buyer on the status of implementation of complaint resolution measures and accept audits by the Buyer regarding
the Complaint at the request of the Buyer.
3. Consultation for Resolution of Complaints
In resolving the Complaints, Buyer and Supplier shall hold consultations in good faith with a view to seeking constructive andpractical complaint resolution measures that will benefit Buyer, the Supplier and stakeholders from a medium-to long-term perspective.
4. Corrective Action Request
If the Supplier is found to have violated Paragraph 2, the Buyer may request the Supplier for corrective action. The Supplier shallsubmit to the Buyer, within [ ] months from the date of receipt of such corrective action request from the Buyer, a report setting out
the reasons for such violation and the plan for its remediation and correct such violation within a reasonable time.
5. Termination
Notwithstanding the Buyer's demand for corrective action against Supplier as set forth in the preceding paragraph, if the Supplier fails
to remedy the breach of Paragraph 2 within a reasonable period of time and as a result, a material breach of such provision continues,
the Buyer may terminate the Master Transaction Agreement or Individual Contracts in whole or in part. Provided, however, that thisshall not apply if there are justifiable grounds for the failure of the Supplier to correct such breach.

6(2) Grievance Centers Guidelines
The Guidelines describe the governance and procedures of grievancemechanisms in establishing and operating the grievance centers.

7(3) Basic Action for
Engagement and Remedy Guidelines
The Basic Action lists ten actions that Japanese companiescan implement for strengthening grievance mechanisms.

8Messages
We have received messages which welcome the Guidelines from key persons invarious sectors.
Ms. Cristina Tébar Less Head, OECD Centre for Responsible Business Conduct
The OECD Guidelines for MNEs and related tools and instruments on Responsible Business Conduct, reflect
internationally agreed expectations for business to address their adverse impacts on people and the planet acrosstheir supply chains. Meaningful stakeholder engagement, enabling and supporting access to remedy, andlegitimate remediation mechanisms, including corporate level grievance mechanisms, are critical components ofsupply chain due diligence and recognised in the OECD Due Diligence Guidance for Responsible Business Conduct.
The OECD Centre for Responsible Business Conduct commends the efforts of the Global Compact Network Japanand the Business and Human Rights Lawyers Network in developing the “Engagement” and “Remedy” Guidelines
for the Promotion of Responsible Business Conduct and Supply Chains, and looks forward to continued
collaboration.

Ms. Akiko Taguchi Director, ILO Office for JapanWe are delighted to be invited to participate in the formulation of the Guidelines. As Japanese enterprises have
had an increased impact on people working around the world through their supply chains, we become aware thatthe appropriate and courageous business actions contribute to the economic and social development of other hostcountries. In order to realise responsible business conducts, engagement and collaboration with stakeholders ascomplements to due diligence efforts will play a crucial role (Section 10(e) of the ILO MNE Declaration). This willcontribute to an increased productivity in the workplace, prevent labour disputes, and promote of sustainableeconomic growth and decent work as set forth in SDGs Target 8. The Engagement and Remedy Guidelines cites theILO MNE Declaration, which is a guidance document for enterprises with regard to the ILO International LabourStandards. We hope that the Guidelines will be referenced and implemented by many enterprises and stakeholders.

9Messages
Carine Smith Ihenacho Chief Corporate Governance Officer, Chief Corporate Governance Officer, Norges Bank
Investment Management“Japan Responsible Supply Chains Committee has drafted comprehensive Engagement and Remedy Guidelines for Promoting
Responsible Business Conduct and Supply Chains. We believe that the document’s principle based approach provides valuable
and comprehensive guidance to companies”

Ms. Miyuki Zeniya Head of Sustainable Finance, The Dai-ichi Life Insurance Company, Limited
In a recent society that strongly seeks for a sustainable society, the Engagement and Remedy Guidelines provides guide for
dialogue, handling complaints, and resolving issues with the society, which are essential for companies to think about theirBusinesses and Human Rights issues. It is a guidebook that is easy to understand for many Japanese business people who areworking to solve SDGs challenges, and for those who have started to get interested in this subject. Overseas investors havealready become aware that corporate actions based on a human rights perspective, such as gender diversity and supply chains,
are indispensable. As an institutional investor in Japan that promotes ESG investment, I hope that many people will use thisGuidelines as a reference.

Mr. Minoru Matsubara General Manager, Responsible Investment Division, Resona Asset Management
I would like to express my sincere appreciation for your participation in the Guidelines as an investor. Climate change andsupply chain risk (human rights) are major issues in financial markets, particularly for investors. Investors around the world areparticularly aware of human rights issues, and we plan to provide support from 2020 for resolving various issues in the supply
chain in line with these Guidelines. I would like to request all companies to raise their interest in these initiatives, and toencourage more companies to refer to the Guidelines.

Attorney Akira Kawamura President of Japan Association of Arbitrator; Former President of International BarAssociation; and Of Counsel of Anderson Mori & Tomotsune
In recent years, as the corporate environment has become globalized and the supply chain has grown beyond national borders,the areas of risk management and compliance that companies must pay attention to have dramatically expanded, and thecontents are expected to deepen beyond mere compliance with laws and regulations. These trends have been shown by the factthat the ethical legitimacy of products produced under severe working conditions in developing countries has been questioned
and that the Sarbanes–Oxley Act has called for the compliance with corporate ethics for the stakeholders of society. TheEngagement and Remedy Guidelines present a method for companies to effectively address the global environment ofuncertainty. I hope that the Guidelines will be further refined and deepened to support the globalization of companies.

10Engagement and Remedy Guidelines Website：
https://www.bhrlawyers.org/erguidelines

Contact Information：

Business and Human Rights Lawyers Network Japan Secretariat(Attorney Sakon Kuramoto / Attorney Daisuke Takahashi)
Email: bhrlawyers.japan@gmail.com
C/O Research Center for Sustainable Peace (RCSP), the University of Tokyo
3-8-1 Komaba, Meguro-ku, Tokyo, 153-8902, JAPANTEL: +81-3-5465-8842Global Compact Network Japan Secretariat
TEL: +81-3-5465-8842

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