The Daifuku Group has established the Group Code of Conduct, which outlines the actions to be taken by all officers and employees of the Group in order to realize the company creed and management philosophy. In order to enhance the effectiveness of the Group Code of Conduct, the Daifuku Group has established various internal regulations under this management philosophy system, as well as clarified the definition of compliance to share values within the Group. The Group defines compliance as acting in good faith and complying with not only the internal and external rules, applicable laws, and regulations, but also observing social norms and ethics in all aspects of the Group’s business. The Group aims to continue to meet the expectations and trust of society by ensuring that each and every officer and employee acts responsibly and with integrity.
Group Code of Conduct (extract)
- We will act in accordance with applicable laws, rules, regulations, social norms, and ethics.
- We will place safety as a major premise in all aspects of our business activities.
- We will remain committed to the creed of “Hini Arata” as we take on new challenges and make changes for the better.
The Compliance Committee, chaired by the CEO, aims to strengthen compliance throughout the Group. This committee acts as an advisory body to the Board of Directors with the Legal Department servings as its administrative office. The Compliance Committee is comprised of all directors, officers, and subsidiary managers, and it serves as a headquarters for investigating and responding to serious compliance violations regarding various rules and regulations. Specifically, the committee discusses measures and systems to resolve and eliminate compliance-related problems in the Group and incorporates the results of its deliberations into the organizations under the jurisdiction of each committee member.
The Legal and Compliance Division plays a central role in the day-to-day compliance promotion activities of various departments, including the establishment and operation of compliance-related rules and regulations, as well as training in coordination with the Human Resources and General Affairs Division, divisions in charge of education in each business unit, and administrative divisions. The Audit Division evaluates the effectiveness of these efforts to prevent illicit activities, including corruption, and confirms the existence of illicit activities through internal audits. Important matters are reported to the Board of Directors as appropriate.
Compliance promotion activities
1. Compliance Guidebook
We established our Code of Business Conduct in 2004 and revised it to the Group Code of Conduct in 2019. The Group Code of Conduct has been distributed to Group executives and employees as a booklet. However, in light of the rapid increase in the number of overseas Group companies and the significant changes in the corporate environment, we believe it important to disseminate our approach to compliance throughout the Group in an easier-to-understand format, and thus created the Compliance Guidebook in 2021. This Guidebook includes the definition of compliance for the Group, an explanation of each item of the Group Code of Conduct, and the relationship between each item and the SDGs, and is available in multiple languages for the entire Group. Q&A pages are also provided for more important information to ensure a deeper understanding of the contents. This Guidebook is intended for use by all officers and employees in their day-to-day activities while maintaining a common set of values regarding compliance throughout the Group.
The Group Code of Conduct is reviewed and approved by the Board of Directors after careful examination of its contents in line with contemporary developments, and this Guidebook is also revised in detail to reflect the latest societal circumstances.
2. Compliance education and training
To ensure that all officers and employees of the Group are fully aware of the company’s approach to compliance, the CEO sends out compliance-related messages to the Group via the company’s internal network, and the company also conducts internal training programs for each job category. In addition, since we are conducting an increasing amount of business with many different countries and regions, we offer various training programs on topics such as anti-corruption laws and regulations including anti-bribery regulations, security export control laws, and competition laws in various countries to establish and spread an awareness of compliance.
In fiscal 2022, we conducted 21 different kinds of training and education on compliance that included anti-corruption. Global compliance training on the Compliance Guidebook, which explains the Group’s Code of Conduct and specific examples, is conducted at local subsidiaries as well, with video content available in ten languages. More than 10,000 employees in total participated in this training program from fiscal 2021 to fiscal 2022.
Examples of training topics offered
Group Code of Conduct, anti-corruption laws and regulations (anti-bribery regulations), trade procedure controls including security, competition laws including subcontracting laws, information security, occupational safety and health, harassment, construction industry laws, whistleblowing systems, etc.
3. Compliance Enhancement Month
We have set October as our yearly Compliance Enhancement Month, during which we carry out initiatives to raise compliance awareness among our employees. In fiscal 2022, we invited a legal expert to give a lecture on power harassment and held a discussion event with our employees. A recording of the event was later distributed via video on the company internal network, and it was also published in the company newsletter. Through these measures, we are working to make compliance more familiar to our employees.
In addition to declaring our respect for human rights in our management philosophy, the Group Code of Conduct also includes respect for human rights and stipulates that we act properly in accordance with applicable laws, regulations, social norms, and ethics. Moreover, the entire Group works to prevent corruption and bribery. We also signed the United Nations Global Compact in 2014, clarifying our stance on anti-corruption included in the 10 principles.
The issue of bribery is a serious risk that could directly lead to the tarnishing of our corporate value. Involvement in bribery in emerging and developing countries where the rule of law has not yet been established may distort the proper enforcement of regulations by the host government of the other country and may encourage corruption in the society of that country as a whole. For this reason, we have established Group rules on the provision of entertainment and gift-giving as well as those on the receipt of entertainment and gift-giving to set forth guidelines for the conduct of transparent business dealings by officers and employees of the Group.
With regard to the provision of entertainment and gift-giving, for countries that pose a high risk to the Group due to the nature of the business, trends in the authorities in each country, and other factors, we have established detailed regulations that correspond to the laws and regulations of the country concerned, defining prohibited acts for entertainment and gift-giving, travel expenses, contracts with agents and consultants, facilitation payments, etc., as well as clarifying the specific procedures to be followed. With respect to accepting entertainment and gift-giving, we have created a set of guidelines in a Q&A format that each employee can use in their daily work to make the purpose of the system easier to understand and more widely disseminated. In addition, bribery and entertainment and gift-giving is one of the topics covered in our global compliance training to further spread the system throughout the entire Group.
The Internal Audit Department conducts regular and ongoing audits of all Group operations based on an annual plan, including ensuring proper compliance with laws and regulations, the Group Code of Conduct, internal rules on corruption, and anti-corruption measures, and instructs the Group to take corrective measures when problems are discovered.
5. Preventing anti-competitive behavior
In the Group Code of Conduct, the Group clearly states our commitment to compliance with competition laws and other rules and to promoting fair trade. In addition, the Group has established the Competition Law Compliance Regulations as rules applicable to the entire Group, and the CEO sends out messages through our internal network explicitly stating the company's stance of not accepting any act of profiteering through non-compliance. Furthermore, compliance with competition laws is also included as one of the topics in our global compliance training, and we regularly provide training on the Subcontract Act in Japan.
6. Response to anti-social forces
The Group Code of Conduct stipulates the Group’s policy of taking a firm stance against forces and organizations that pose a threat to the order and safety of civil society and of never having any relationship with these forces and organizations. All officers and employees of the Group are fully aware of this policy.
We have established a whistleblowing system for the early detection of illicit activities and misconduct that may lead to violations of the law or our internal regulations, as well as to take appropriate action. In addition to the internal reporting desk, we have set up an external reporting desk (outsourced by a neutral company) that provides multi-lingual support.
This reporting desk allows anonymous reporting and is available not only to executives and employees of Daifuku and its Group companies, but also to business partners with ongoing dealings. To make effective use of this system, operating rules are stipulated in the Whistleblowing System Rules and its operating standards, and these encompass its function as a whistleblowing system under the Whistleblower Protection Act.
The rules primarily set forth that the Internal Reporting Secretariat is responsible for the administration of the system, verifies the facts of report, determines the course of action to take, and handles investigations among other duties. Investigations differ depending on the severity of the reported case, the degree of urgency, and whether or not upper management is involved. Should a compliance problem be identified through the investigation, corrective action and measures to prevent a recurrence are taken. Critical problems are reported to the Compliance Committee and the Audit & Supervisory Board. In addition, we impose an obligation to confidentiality on those involved in whistleblowing operations and protect whistleblowers so that they will not receive any disadvantageous treatment for filing a report.
To enhance the effectiveness of this system, top management communicates messages through the internal network, hangs posters to make the system widely known, and conducts compliance training for employees on an ongoing basis. In particular, we are working to improve the credibility of this system by publicizing the fact that whistleblowers will not only receive legal protection under the Whistleblower Protection Act, but also that whistleblowers may use this system without fear of retaliation for reporting.
In fiscal 2022, the external reporting desk was used in 17 cases, and the reports were related to labor (9 cases), misconduct (7 cases), and accidents (1 case).
In addition to the whistleblowing system, we have also established a Personnel Consultation Office to receive and respond to questions and consultations from employees regarding personnel systems, evaluations and benefits, workplace environment, working hours, harassment, health management, and more.
Political and administrative relationships
Regarding political activities, we do not provide donations, favors, or other forms of assistance to any specific political party or politician. For political contributions, donations, or other support to any organizations, etc., we comply with the relevant laws and regulations and follow the proper procedures and methods. In fiscal 2022, we made no political contributions.
UK tax strategy
The Group will comply with the various tax laws, accounting standards, and internal rules of each country in which we operate in order to perform accounting procedures, pay appropriate and fair taxes, and contribute to the development of the country or region. Our tax strategy in the UK is shown in the PDF below.