Responsible Supply Chain Management

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The LIXIL Group seeks to ensure stable product supply and fulfill stakeholder accountability by identifying and addressing risks at the procurement stage, and managing our processes across our supply chain.

Action plan Extend our Japanese CR procurement process across the Group
KPI Responsible procurement surveys coverage ratio (based on purchased amount) (%), and percentage of suppliers which satisfy CR management standards (%) and improvement rate (%)

Target / ProgressOPEN or CLOSE

  • Target for FY2016

  • ・Promote Group-wide awareness of the LIXIL Group's procurement strategy

    ・Implement existing CR procurement process across the Group

  • Progress as of 2016

  • ・Achieved responsible procurement surveys coverage ratio of 85% in Japan and 80% outside of Japan, CR management standards conformity rate of 94% in Japan and 88% outside of Japan
    ※exclude GROHE Group S.a r.l.、American Standard Brands and PERMASTEELISA GROUP

  • Target for FY2017

  • ・Achieve responsible procurement surveys coverage ratio of 90% in Japan and 60% outside Japan, 90% conformity rate, and 100% improvement rate
    ※exclude PERMASTEELISA GROUP

Procurement Policy

The LIXIL Group has established a Procurement Policy to develop healthy business partnerships with counterparts worldwide. This policy forms the basis of our overall supply chain management. In FY2017, the Group developed a Procurement Compliance Policy to provide more detailed guidance for the whole Group. We also compiled our Supplier Code of Conduct and are working to ensure business partners fully understand all the items they are required to adhere to.

Procurement Policy

Fair and Impartial Trade Practices
We will provide suppliers with equal and open opportunities, and solicit suppliers broadly. When selecting suppliers, we will evaluate them fairly and impartially, paying due consideration to CR aspects such as environmental management, human rights, and workplace safety, in addition to quality, cost, and delivery.
Adherence to Social Norms
We will observe laws, regulations, and rules related to procurement activities, and act in a way that gains the trust of society.
Respect for Human Rights and Consideration for Working Environment
We respect internationally declared standards of human rights, and pay due attention on ensuring an appropriate working environment.
Care for the Environment
We will preferentially procure raw materials that have low environmental impact.
Promotion of Mutual Prosperity with Our Suppliers
We will conduct transactions in a way that promotes mutual growth as partners.

Promoting Responsible Procurement that Upholds the Environment and Labor Safety

The LIXIL Group promotes responsible procurement. The Supplier Assessment Standards used to select business partners includes: quality, cost, and delivery (QCD) criteria and technological prowess, the ability to deliver stable supply, sustainable use of resources, proper control of chemical substances, human rights, and labor safety. The supplier assessment criteria are applied in both the selection of new partners and the regular inspection of existing partners. Having selected a business partner, we also conduct assessments of procured products. We seek to strengthen responsible procurement across our network of international business partners, which has been extended by mergers and acquisitions.

Working with our Suppliers

Supplier Breakdown

In terms of procurement transaction amounts, nearly 90% of LIXIL Corporation suppliers are based in Japan, followed by China, Austria, and Thailand. We determine our important suppliers using the criteria in the flowchart below, prioritizing them when we distribute our procurement strategies, conduct surveys, and follow up on improvements.

Procurement transaction amount breakdown by country

Procurement transaction amount breakdown by country

[Scope of application] Suppliers to LIXIL Corporation and its subsidiaries

*Excluding GROHE Group S.a r.l., American Standard Brands, PERMASTEELISA GROUP

Flowchart for important suppliers

Flowchart for important suppliers

Responsible Procurement Surveys and Follow-up Action

IXIL Corporation actively shares our Procurement Policy and Supplier Code of Conduct to help steer our expanding and increasingly complex supply chain network following five-company merger in 2011 and subsequent series of international mergers and acquisitions.

We use responsible procurement surveys to gain a strong understanding of business partners' responses on 66 different survey items (46 for Japan, where low-risk items have been removed).

We visited over 100 suppliers inside and outside Japan that performed poorly in our survey to set targets for improvement and provide necessary support. We attained our target of 90% conformity on procurement assessment items. The survey results serve as a valuable evaluation tool when appointing business partners.

Responsible Procurement Survey

  Overseas Japan
1. CR Operations 10 questions 6 questions
2. Fair Business 8 questions 8 questions
3. Human Rights 7 questions 6 questions
4. Labor 13 questions 9 questions
5. Health & Safety 9 questions 7 questions
6. Environmental Conservation of the Planet 14 questions 8 questions
7. Regional Contribution 5 questions 2 questions
Total 66 questions 46 questions

Survey sheets

Survey Results

Tasks KPI FY2014 FY2015 FY2016 FY2017
Results Targets Results Targets Results Targets

Distribute Procurement Policy; follow up survey results and related activities

Coverage ratio
(based on purchased amount)
Japan 72% 80% 82% 80% 85% 90%
Overseas* 82% 60% 81% 60% 80% 60%
Total conformity rate Japan 93% 85% 94% 90% 94% 90%
Overseas* 91% 85% 85% 90% 88% 90%
Improvement rate Japan 100% 97% 100% 100% 100%

[Scope of application] Suppliers to LIXIL Corporation and its subsidiaries

*FY2014-2016: Excluding GROHE Group S.a r.l., American Standard Brands, PERMASTEELISA GROUP.
FY2017: Excluding PERMASTEELISA GROUP*.
Japan: Procurement by operating sites in Japan
Overseas: Procurement by operating sites overseas
*FY2014 data have been revised

Management of Chemical Substances

LIXIL Corporation has set rules on chemical substances that are forbidden or require strict control for use in products and/or during production processes.
LIXIL's list of controlled substances can be downloaded from the link below:

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