Respect for Human Rights
Examples of Initiatives
Fiscal 2019 Initiative Details
In fiscal 2019, we conducted human rights risk assessment (risk mapping) for Sumitomo Chemical and 162 consolidated Group companies. With
the help of external experts, we estimated potential human rights risks in each company based on their businesses, location (country and region),personnel composition, and the raw materials and products they handle. Then we examined how each company addresses risks, by referring to
the results of internal audits and responsible care audits that had been conducted for the Company. These processes were aimed to make ourassessment objective and pertinent to actual situations.
Risk Evaluation Items
For this risk assessment, we first set the four categories of society, environment, occupational safety and health, and governance as major focal
areas, and for each category, we determined items in detail for assessing risks. For example, in the category of “society,” we selected such diverse
items as forced labor, child labor, discrimination, harassment, freedom of association, indigenous people, and cultural heritage. In other categories,
we conducted risk assessment as to those items that we had addressed in audits, by examining them from a human rights perspective.

Society
S1S2
S3S4S5S6S7S8S9S10S11S12

Environment
Forced labor and human trafficking
Child labor
Work hours
Wages and employment contract
Discrimination
Harassment and punishments
Freedom of association
Land rights
Negative social impact on local communities
Indigenous people and cultural heritage
PrivacyCountermeasures and management procedures(supply chain)

E1
E2
E3

Environmental pollution
Resource management
Noises, vibrations, and odors

Occupational Safety and Health
HS1HS2HS3HS4HS5Countermeasures and management procedures
Machine safety
Fires and explosions
Hazardous operations
Infectious, dusty, and asbestos operations

Governance
G1G2G3G4

Prevention of bribery
Prevention of accounting fraud
Prevention of quality-related fraud
Examples of violations

Policy for Calculating Risk Scores
Regarding each item, we confirm activities as factors either contributing to or reducing risk. When there are activities that could become risk
factors, we add to the risk score, and when there are activities that reduce risk factors, we subtract from the risk score, thereby quantifying risk. Thehigher the risk score, the higher the human rights risk.
Examples that add to the risk score:• Employing foreign national workers and migrant workers• Operational region of the Group company ranked as a high-risk country in indices published by international institutions(for example: the Global Child Forum & UNICEF’s Children’s Rights and Business Atlas)• Businesses considered labor-intensive (business categories considered to have a relatively high ratio of low-wage workers)

Examples that subtract from the risk score:• Confirming the personal IDs of migrant workers and storing copies• Formulating policies related to prohibiting child labor• Confirming the provision of employee wages in an amount adequate to provide for a family and meet basic needs, such as food and housing

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Fiscal 2020 Initiative Details
We conducted an on-site or written survey as a detailed investigation of 30 Group companies that were rated as having a relatively high risk in thehuman rights risk assessment (risk mapping) conducted in fiscal 2019 for Sumitomo Chemical and its Group companies.
Document Inspection – Targets: 26 companies, in locations including China, India, Thailand, and Japan
Under the four categories: Society, the Environment, Health & Safety, and Governance, questionnaires were sent and answers were collected. Thecompanies were asked whether they conducted any business activities with high human rights risks and about the implementation status of risk
mitigation measures.
On-site Inspection – Targets: 4 companies total, in China, Thailand, and Tanzania
For the Group companies identified to have particularly high human rights risks, outside experts were appointed to conduct inspections including
reviewing documents such as employment and wage regulation documents, conducting interviews with local employees (including temporaryemployees), and inspecting the work environment (including the remote investigation).
As a result of these investigations, we learned the following.
Good initiatives that should be referenced by other Group companies to mitigate human rights risk:• Environmental conservation and occupational safety and health measures are being rolled out at a high level (all 4 companies) (for example: working on continual improvement, including waste reduction activities and rain water recycling, going beyond legal and regulatory
requirements)• The basic procurement principles are translated into local languages and communicated to all primary suppliers (Tanzania)• External attorneys are invited every year to conduct training for employees on regulations and the latest trends related to labor problems(China)Issues that need improvement:• Measures are taken as a practical matter, but mandatory matters for suppliers regarding human rights and labor are not specified in evaluation methods or standards (China, Thailand)
Initiatives in FY2021
Human rights risk evaluations (human rights risk mapping) were conducted by external specialists in fiscal 2019, and in fiscal 2020 we conducted
detailed surveys (written and on-site) for Group companies thought to have relatively high levels of risk in the human rights risk evaluations.
In fiscal 2021, we conducted follow-up surveys to the detailed surveys. Specifically, we held hearings with external specialists and local Group
companies to determine differences in regulations and standards depending on the country and region and confirmed the status of respect forhuman rights initiatives, from the provision of a living wage to ensuring that foreign national workers are able to hold their own passports. As aresult, at Group companies where we conducted detailed surveys, measures are being taken in line with the laws and regulations of each country,
and we did not discover major risks that violate matters required by international standards, such as the International Labor Organization’s Core
Labor Standards.* Nevertheless, to further strengthen respect for human rights, we take such measures as highlighting human rights and laborwhen making requests of suppliers. In addition, Group-wide we are rolling out good initiatives identified in the previous fiscal year’s survey thatshould be referenced by other Group companies with the aim of mitigating human rights risks.
* The ILO’s Core Labor Standards established minimum standards related to labor, specifically singling out the right to freedom of association and collective bargaining,prohibition of forced labor, prohibition of child labor, elimination of discrimination, and safe and healthy working conditions.

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