Compliance

Basic Concepts on Compliance

  • The Sumitomo Rubber Group

In the Sumitomo Rubber Group, we believe that “legal compliance and the upholding of corporate ethics form the cornerstone of a company’s survival and are crucial to long-term corporate vitality and competitive-ness.” To ensure that this belief is embraced by all, we formulated the “Regulations on Corporate Ethics Activities” and the “Sumitomo Rubber Group Code of Conduct” in February 2003. These principles are continually enforced, informing our efforts to develop a compliance structure for the entire Group and foster compliance awareness among employees. In addition, in 2004 we established a Compliance Consultation Office offering an in-house point of contact and have commissioned an external lawyer to serve as an external contact. Furthermore, we provide all employees with a compliance card featuring a message designed to instill compliance awareness as well as the abovementioned office’s contact information to facilitate reporting. In this way, we ensure that every employee knows about the compliance reporting line, which operates outside the regular reporting lines within the job hierarchy. We have thus developed a structure capable of ensuring the early detection of misconduct.

Structure of Compliance Initiatives

Structure of Compliance Initiatives

Sumitomo Rubber Group Code of Conduct

Code of Conduct

Our Code of Conduct provides all Sumitomo Rubber Group officers and employees with specific, easy-to-understand guidelines regarding the basic stance they should take and the mindset they should adopt in the course of their business activities from the aspect of legal and regulatory compliance.
Moreover, our business partners in transactional relationships with the Group are expected to act in accordance with this Code of Conduct.
The Code of Conduct is translated into the eight languages listed below. All versions can be accessed on the Company’s corporate website.

Code of Conduct
Compliance card
Provided to all employees

Thoroughgoing Compliance

  • The Sumitomo Rubber Group

We drive home to our employees the importance of avoiding all wrongful conduct, including corruption, through our “Corporate Code of Conduct,” which was updated in 2022. Specifically, this Code of Conduct prohibits employees from engaging in monopolistic practices, unfair competition or business dealings, or bribery while requiring the severing of any relations with anti-social forces. Furthermore, it imposes a ban on the provision of entertainment, gifts, donations or other benefits in excess of generally accepted customs as well as engagement in insider trading.
In fiscal 2023, we continued to provide compliance training covering various areas at domestic and overseas bases. In addition, we have focused on developing a structure that enables each base to autonomously implement compliance activities on its own.
Going forward, we will strive to help all Group employees raise their compliance awareness.

Promoting Compliance in Collaboration with Suppliers

  • The Sumitomo Rubber Group

In addition to ensuring that its Code of Conduct is understood and upheld by all employees and thereby securing strict compliance, the Sumitomo Rubber Group has formulated Procurement Guidelines that include a universal prohibition against bribery and corruption. Our suppliers and other business partners are asked to comply with these guidelines. In these and other ways, we strive to secure thoroughgoing compliance throughout our supply chain.
Furthermore, we conduct proper due diligence in a manner that aligns with conditions in each region and country when, for example, acquiring a business from other companies, executing M&A via the purchase of shares or commissioning an external agent to handle our business on behalf of the Group. Specifically, we confirm the compliance status of our counterpart or agent. When we open new transactions, we similarly conduct due diligence via, for example, the use of an external audit company, to determine the soundness of our counterpart, with the aim of mitigating the risk of compliance violations.

Properly Handling Reports and Accommodating Requests for Consultation via the Establishment of In-house and External Helplines (Whistleblowing System)

  • The Sumitomo Rubber Group

In February 2004, the Sumitomo Rubber Group set up the Corporate Ethics Help Line, an internal reporting line designed to accommodate requests for consultation regarding various issues associated corporate ethics, including harassment, monopolistic practices, corruption and other misconduct.
In addition to educating employees on the importance of compliance, we guarantee that the anonymity of the whistleblowers is protected, with no detrimental treatment imposed upon them. We strive to let our employees, as well as individuals outside the Group, know about this guarantee and thus promote their use of our helpline.
Whenever a report is received, we immediately launch an investigation into the incident, conducting interviews with relevant departments and individuals to confirm the facts. Once it is determined that misconduct has occurred, we implement appropriate measures in accordance with internal rules. The usage data of the helpline is reported to the Corporate Ethics Committee on a quarterly basis and to the Board of Directors at regular intervals.
In 2023, a total of 65 cases were brought to the helpline. Of these, 28 cases were associated with power harassment. We strove to properly handle these cases, responding by, for example, taking disciplinary action against the perpetrators or executing other rule-based measures as appropriate in addition to implementing training focused on the prevention of such harassment. Other than power harassment cases, we have completed measures for cases where improvements were deemed necessary.
Furthermore, we received allegations of misconduct and inquiries about labor management in 2023, however, we found no serious violations of workers’ rights.

Number of Reports and Requests for Consultation

Number of Reports and Requests for Consultation

Corporate Ethics Help Line

As explained above, the Sumitomo Rubber Group maintains the Corporate Ethics Help Line as a contact through which it collects information regarding possible violations of laws, regulations or corporate ethics and accommodates relevant inquiries. Officers and employees of the Sumitomo Rubber Group at home and abroad, as well as its business partners around the globe, can report to or request consultation with this helpline.

The Corporate Ethics Help Line is accessible from here.

Compliance Education and Training

  • The Sumitomo Rubber Group

The Sumitomo Rubber Group provides employees with education and training on such important subjects as compliance with competition laws, the prevention of bribery and the prohibition of misconduct. Specifically, we have designated October as annual Compliance Month to help employees raise their compliance awareness. Throughout this month, we provide e-learning to all employees while, on an as-necessary basis, implanting training for new recruits and conducting grade-specific training programs. As such, we strive to ensure that all employees are well-versed in these compliance-related subjects.
In fiscal 2023, we hosted briefings on the Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors and the Act against Unjustifiable Premiums and Misleading Representations. At the same time, we held similar training sessions at domestic and overseas Group companies. In this way, we engaged in ongoing activities aimed at securing proper compliance throughout the Group.

Results of Compliance Activities

Item Detail / Target Number of recipients
Compliance New recruits, employees, officers and managers Sumitomo Rubber Industries, Ltd. and Group companies 386
Export control: The Foreign Exchange and Foreign Trade Act and compliance with OFAC regulations Sumitomo Rubber Industries, Ltd. and Group companies 48
Antimonopoly Act Sumitomo Rubber Industries, Ltd. and Group companies 281
Transactions with subcontractors: The Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors Sumitomo Rubber Industries, Ltd. and Group companies 242
Contracts in general Sumitomo Rubber Industries, Ltd. and Group companies 195

Legal Punishment of Employees for Corruption / Fines and Other Orders Imposed by Authorities

  • The Sumitomo Rubber Group

In fiscal 2023, the number of cases in which the Sumitomo Rubber Group was subjected to fines, punishment or other legal measures, was zero.
Since 2017, no employee has been reprimanded or dismissed due to the violation of “Compliance Rules on Bribery Prevention” established by the Group.

Relationship with Business Partners

  • The Sumitomo Rubber Group

The Sumitomo Rubber Group has constantly engaged in activities aimed at securing compliance. These activities encompass business operations undertaken by transactional counterparts, agents and other third parties, including a number who provide brokerage services for such undertakings as joint venture businesses. The Corporate Ethics Help Line is also available to our business partners.
With regard to suppliers, we have formulated Procurement Guidelines that include the universal prohibition of any form of bribery and corruption. Thus, we promote initiatives to ensure strict compliance throughout the entire supply chain.

Information Security

  • The Sumitomo Rubber Group

The Sumitomo Rubber Group is acutely aware of the importance of protecting and properly managing privacy and secret information. Accordingly, we strive to ensure the appropriate handling of this information. To date, we have formulated a “Privacy Policy,” a “Social Media Policy,” “Rules on the Protection of Privacy Information,” a “Manual on Privacy Information Protection Measures” and “Information Security Rules.” We leverage our Code of Conduct and e-learning programs to help employees gain deeper understanding of these policies and rules, along with other precepts regarding the protection of privacy information. Moreover, we annually confirm the status of the confidential corporate information possessed by each department in order to ensure that the importance of information management is understood by all.
In fiscal 2023, we conducted e-learning on cybersecurity, phishing attack training, cybersecurity measures in domestic and overseas bases. Simultaneously, we addressed the implementation of the JAMA Cybersecurity Guidelines and the implementation rate reached 95% for items up to level 2. Looking ahead, we will continue to strengthen information security on various fronts, including aspects of infrastructure and human resources.